You are correct, it would be the same email address and password when you access your email on the hotmail website. Aside from the reduced email storage, here are the other features that you will lose:
1. MSN software – Internet software that serves as a browser, an e-mail program and a Download Manager in one. It provides you the ability to view your online and offline MSN mail, and provides easy access to other Microsoft services like Bing, Windows Live Spaces, Windows Live Calendar, Windows Live Messenger, MSN Money, MSNBC, MSN Games and MSN Shopping.
2. Round the clock Phone, Chat, and Email Support for technical and billing inquiries.
3. Free MSN Virus Guard and Personal Firewall c/o McAfee.
4. Free Webroot Anti-Spyware program (Spy Sweeper).
5. Ad-free e-mail service that lets you see messages in a preview pane and manage multiple Hotmail, MSN and POP3 e-mail accounts using the MSN software.
6. Unlimited Storage. Your initial email storage capacity starts at 10GB that automatically grows with your needs.
7. No account expiration. You don't need to log in to MSN or Hotmail regularly to keep your account active.
NOTE: Accounts are deactivated if you have not logged in at least once every 270 days. Once an account becomes inactive, all email messages and contacts information are deleted from the server and cannot be retrieved even if the account is reactivated.
8. Automatic Email Forwarding is enabled for all email domains not hosted by Microsoft (ex. Yahoo, Gmail).
9. More Safe Addresses. Your Safe Address limit is increased from 250 to 500 which helps avoid e-mail messages from valid contacts landing in the Junk e-mail folder.
10. You can add up to 10 e-mail accounts for your subscription so these e-mail accounts can have the ability to use the MSN Internet software.
Hope this helps.
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