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Manage Size of Exchange 2007 Database in SBS2008

I deleted all the content of four users through Outlook then ran the command to see the new size of their email account and it shows the new size however when I go to program files...(down the Exchange database path) the exchange database shows as the same size. How do I shrink the database, it seems to always stay the current size or continue to grow even after deleting users.
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If it never shrinks how do you go about managing disk space?
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You must set the retention interval temporarily to 0 and after that run the defrag. Then set the interval back to the original.
I'm expanding RAID5 array this weekend, so I'll get disk space this way but eventually you can eat through another amount of drive space if you allow users to grow their email too large. What baffles me is we have a high turnover rate so when someone leaves I thought deleting their exchange account would help with disk space, it's like this in Exchange 2003, delete email and the store gets smaller. Strange it doesn't work this way in 2007.

How do I delete users I notice there isn't a purge option
1221 event logs only talk about the second storage group and not the first one.
now this is urgent, the size of the C: drive just went to 499M when I opened up a new user. Dropped from 6.5G to 499M
Is the database stored on C:?
yes, SBS2008
I´d insert another RAID array and move the database over to the new partition. Never ever have OS and data on the same partition! If data runs full you´ll also have your OS screwed!
In case you have another server or partition where your users data is stored on, you should set low mailbox quotas and implement .pst files for your users to get their mailboxes smaller and archive their mails to these .pst files.
thanks