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Yahoo! Launches Password Free Email App, Jumps 4.3%

Shares of Yahoo! Inc.YHOO rose 4.3% to $33.48 after the tech giant announced an update to its 18-year old email service for Apple AAPL iPhones and Android GOOGL products, in an attempt to make it fuss free for users. The new Yahoo! Mail app is now available on the respective app stores.

Yahoo launched an updated email app, which will be password free and will let a user handle accounts from multiple third-party email accounts including Microsoft's MSFT Outlook, Hotmail and AOL on both mobile and desktop.

The updated app features a more secure and simple alternative to the old password called "Account Key" that enables users to sign into their email accounts using the push notifications sent to their smartphones, seeking authorization instead of typing in a password.

This will speed up the process of signing into email using a mobile device. Also, Yahoo! is optimistic that the new offering will be more secure because users will no longer have to rely on passwords that are easy for hackers to guess.

But it comes with its own set of drawbacks. Users will have to have a smartphone to use it, as it requires the app for verification. Upon loss of their phones, users will have to authenticate the login through a secondary email address, which is not really ideal.

But then again, Yahoo! Account Key is completely optional as Yahoo! will continue to offer the option to log in using a password. Also, for everyday use, Account Key with its enhanced security could be the perfect solution for users.

Yahoo!, once upon a time the leader in web-based email providers, has lagged behind since Google launched its email service in 2004. Per comScore, Google and Yahoo! both had around 96 million U.S. email users in Aug 2013. In Aug, 2015, Yahoo! had 190 million users, down 16% from the same time last year, while Gmail boasted 411 million, an increase of 5%.

Email users are an important source of traffic at Yahoo!'s other offerings, including sports, entertainment and finance which help sell advertising that accounts for the majority of the company's revenues. Therefore, it is trying to grab more traffic and advertisers and the new update is a part these efforts.

Yahoo! has a Zacks Rank #4 (Sell).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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