Wave is combining several functionalities in a way that it somehow covers all of the following in one integrated framework: eMail, wikis, google docs

From eMail to instant messages: Users can send messages and have chat-like conversations. New members of a conversation see the whole thing instead of just the new stuff.

From Wikis to Collaborative Documents: In the same time, all participants of such a conversation or document, can edit everything in there, easily link other such documents or web content and changes are being simultaneously pushed to all participants.

From changelog to playback: Instead of single diffs, one can just play back the whole history of such a document, easily tracking each user's contributions.

Client-Server-Server-Client: Everyone can set up their own waves server and like eMail, IRC or Jabber, they will federate content across in real time, so users can choose whichever provider they want.

It's extensible: Everyone can contribute, especially by adding various kinds of extensions – of which they have allready shown some quite amazing examples. And it will be open source, so everyone can change it and run their own server.

I can't summarize it all here, go watch the introduction video for yourself (or search for better summaries ;).

I wonder wether this might even bring the long desired change away from our current old eMail system with its many flaws (that I will discuss another time ;).