I started watching it as a small video in the background and kept finding myself switching to full screen so I could really watch and follow what they were doing. I'm not going to attempt to summarize the 80 minute video introduction, nothing I could say would really cover it. You should spend the time and go check this out.
I will talk about some of my reactions:
First, wow. This is a solution to the fragmentation of communication. Email, IM, Twitter, Facebook, etc. There are too many channels we use to communicate, many of which are dated.
Open Platform, Open Source (mostly).
Build on GWT. HTML 5 seems to be a big focus.
RIAs - Sun, Adobe, and Microsoft are pushing their rich client platforms. Apple and Google are focused on HTML 5. This app makes a pretty strong case that HTML 5 is sufficient for nearly every app.
Playback - a cool concept that provides context that may be lost along the way. Integrates with the plugins, etc. Cool.
Convergence - Google has launched quite a few apps of varying success. Mail, Maps, Apps, Social Networking, News, Translation, etc. Wave takes these and combine them in a way that far exceeds their individual value.
Extensions - This is an extensible platform of course. Wave is cool today, but will be much more tomorrow.
Federation - This is what makes the entire concept feasible. You can have corporate wave servers but still interact with the various vendors, consultants, etc when necessary, and everything that is private never leaves your server.