Gmail was handing out email accounts with 1Gb of storage for free, when everyone else was only giving like 5mb. It was a no-brainer to switch back then.

- Drastically improved user interface.

- Massive free storage for the time (1GB IIRC).

- Google caliber fast, powerful search across your personal emails.

- Either invented or popularized the modern conversation view for email threads. Most clients would still do one email per reply.

Hotmail and yahoo were pretty much destroyed overnight.

Gmail initially offered very big email storage space comparing the others, and it was going up continuously until its storage area merged with Google Drive.