I would say it's generally a good benefit to have, but I'd say the vast majority of personal email users don't use a lot of mail. Certainly not on the scale of Google engineers.
I'd call it a good selling point and competitive differentiator, but it wasn't some magical thing discovered because they were using it themselves. He said they never even considered other designs.
In terms of impact, it's much better to build a product for people who spend several hours/day using email instead of those who login once every few weeks to delete their spam. For the latter case, just about anything is good enough (even Hotmail).
That's very true, however it still doesn't make it a good example of why eating your own dog-food is good. Instead, it's a good example of why designing for yourself as a target audience (like 37signals) can be a good thing.
Incidentally, I am most definitely not arguing against the dog-food approach to development.
just about anything is good enough (even Hotmail)
Hotmail now allows you to mark message as "read", do you believe it? They did not offer this option for years!
Anyway, I have a question for you.
I am working on my startup, and I really like your approach: "launch fast and iterate"... but I am afraid of users! I am afraid from their judgements on my startup..
Do you have any solution to "get rid" of this fear?
EDIT: Even if I receive -8, I am not going to change a charachter of this!
Another example of the utility of eating one's own dogfood.