Google has always favored many-to-many "tags" over one-to-many "folders". Gmail brought that distinction to the mainstream. Circles are really just tags on the user object, in the end.
I've always heard that only 5% of email users use Gmail, but I don't actually have a source. Does seem to be accurate based on my (non-techie) friends.
34.5% yahoo.com
24.0% other
13.9% aol.com
9.9% gmail.com
2.6% comcast.net
2.2% msn.com
My mistake.