Be fair, Gmail was groundbreaking. It's UX was miles ahead of anything else. Especially webmail UIs.
Google was a good product company for a while. But the it wasn't anymore.
Not my experience. UX was more or less in line with everyone else, UI just looked cleaner and prettier because it didn't yet have obtrusive ads compared to the competition.
Gmail was groundbreaking because it offered 1GB of storage at launch compared to measly 100MB or so from Yahoo or Microsoft.
Google brand name + invite only scarcity at launch + huge storage space + no ads at launch = the formula the drove initial popularity.
Why would anyone do that?
Part of the trend of needing to dumb down everything by removing "power" user features because we can't trust non-computer savvy users to not self immolate their data.
Sure, they were innovative to use XHR along lots of Javascript to improve the experience, but what got people into were the 1GB + no ads.
Nowadays, they probably offer one of the worst email experience, with ads and terrible privacy. How many times have we heard about the US government reading emails from other governments countries, like US spying on ex-presidents from Brazil regarding oil companies?
Google had also the coolness factor of the "don't be evil" and being overall a lean and trustful company. Nowadays nobody thinks of Google like this.
gmail did away with the idea of folders and instead had tags. They were very clearly an innovation on top of how most organization happened with email.
granted, those tags were shunted into folders for the IMAP protocol, but if you were using the web UI it was a whole other world.
The rest of the world caught up, but at the time they were absolutely groundbreaking. yahoo and hotmail existed at the time but neither had anything on gmail.