Open-Xchange raises $5.2 million and teams with Qwant to develop email with new privacy protections

Nuremberg-based Open-Xchange, a long-time provider of white label email, is taking a giant leap into the consumer space by developing a service designed to strike a new balance between privacy and advertising.

During a French-German government digital summit this week, Open-Xchange announced a partnership to develop the service with Qwant, a privacy-focused search engine based in Paris. The idea is to create a European-based alternative to most email services in a way that severely limits collection of user data and the ability to sell it to advertisers.

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With the new service, called OX.io, users can opt into any broad advertising category or they can get an ad-free premium version. The companies promise users that their email and search history will not be tracked. And the email will come with PGP encryption. Qwant, which launched in 2013, offers search in a similar privacy-friendly way.

The initial version of OX will integrate Qwant search with email, as well as calendar, contact, and task management functions. The service offers 2 GB free email storage, plus an additional 2 GB of cloud storage for files. The service is officially hosted in Berlin, where it is subject to relatively strict German data protection laws.

Being a new player in email might seem like a long shot. But, in fact, Open-Xchange already powers millions of email accounts behind the scenes for companies like Liberty Global, Vodafone, KPN, and STRATO. These white label email accounts will eventually have the same privacy options as OX, and will be part of the same advertising network.

Open-Xchange founder and CEO Rafael Laguna said he hopes the company can use that scale as leverage to convince advertisers and users to accept a different approach to the question of email and privacy. OX.io is available now as a beta.

“Given our size, we want to create that market,” he said.

With 230 employees scattered around the globe, the company is now hoping to step into the spotlight a bit itself. To help take this next step, it has raised $5.22 million in venture capital in a round led by eCAPITAL.