Since the initial press release (which, frankly, seemed like an April Fool joke) announcing Google's Gmail, a lot has been said about it: the usual privacy concerns, the massive and not easily replicable distributed computing infrastructure that Google might have built, Forbes review predicting demise of hotmail and others, and so on.
However, all these analyses are missing an important angle: With Google's tremendous storage capacity and computing power, it would be able to do the same with Email that it has been able to do with Web pages. I am referring to its pagerank based analysis and categorization of the web pages, which simply exploits the fact that hyper-linked web pages have an inherent structure and this structure conveys something important about each page.
Now think about individual email messages -- each email message also has an inherent structure: who sent it? to whom? when was it sent? was it a response to another message? how did the communication evolve? Analysis of a very large number of email messages can yield some very interesting facts about individuals, their relationships with others, opinons, tastes etc. Combine these with an engine that builds personalization profiles based on other factors (such as search phrases and click-behavior on returned results) and what you have is a very powerful and adaptive personalization scheme. This can certainly be used for a number of consumer services or enhanced options for existing services, besides very targetted and focussed ads.
The pattern of email communication could have other uses -- think of social networks being promoted by likes of LinkedIn and Google's own orkut. The combination could be much more powerful, intelligent and perhaps significantly more useful to the consumers of these services!
All this will certainly redefine the very meaning of Email. No wonder Google invented a new word to describe this service: Gmail.