GMail's time was different, there was a lot less competition among web services back then.
1. Exponentially more space in a market where single or double digit megabytes was the norm. GMail's original pitch was that you never had to delete an email, and that you could always find them with search.
2. It was one of the first web apps. It was dynamic in a way few sites were then. Asynchronous JavaScript (Ajax) and Web 2.0 were still new concepts.