mattwnz:
I think at the time Gmail was a very big player, especially as it was operated by google. But I suspect it was more to do with other ISPs using yahoo, and not sure if google sold mass email services in bulk to ISPs at that time, and whether it would have been as cheap. Email is a painful service to provide, as people expect it for free or next to free, yet it requires a lot of support.
And abuse the hell out of free ISP services like trying to run mailing lists thru the smtp server that is for personal mailboxes etc. Had to seriously school a friends "IT provider" over trying to do that.