Your web app needs to be ten times better than the competition
contrast.ie
contrast.ie
I thought the success of Gmail was due mostly to the hype and the perceived rarity of having the address at the time.
People don't seem too averse to changing emails. I suspect the growth of .mac emails has increased about on par with the growth of Apple market share over the last few years.
So, for me, Gmail was more than 10x better, just because of the 1GB size limit.
For example, you can make an operating system 10x better than Windows, but Windows can still have the lion's share of the market. Instead, make a new category of operating systems: operating systems for a new type of computer (iPad) or turn the browser into an operating system (Google Chrome).
In other words, if your competition is playing a winning game, don't play their game. They've already proven they are winners at it. Invent your own game.
Another example is video sharing sites. By your statement, if you are not Youtube or looking to be 10x better than YT, you should just call it quits and forget it, but look at all the other video sites - CollegeHumor, Justin.tv, Vimeo, etc.
Helps us to aspire to a higher standard.