That has to be a mistake. You already can upload more than 7 GB using Google Docs. It would be more in line with Google to offer 100 GB or 1 TB free and really blow away the competition. I wonder if they have considered what it would cost to offer 1 TB of storage vs. buying Dropbox. Most people would not use anything close to the maximum and of course the storage costs will get cheaper over time.
Google needs to give people a compelling reason to try out the service. Remember when GMail launched in 2004 and 1 GB of storage space for e-mail seemed crazy? I think Hotmail offered 4 MB of space at the time. You had to constantly delete old e-mails to keep below the quota. Storing files in the cloud is reaching a tipping point where it becomes mainstream. Google needs to get a foothold now if they want to be the leader in this product category.