Yes, and the 1 gigabyte of free storage was plausibly a prank at the time--hotmail at the time provided 2MB, for comparison.
Amazing to think many emails don’t fit in 2mb anymore.
They were trying to get out in front of the NYT breaking the news of GMail, see The Social Radars podcast episode with Paul Buchheit (https://www.thesocialradars.com/episodes, great episode).