Not just internally. I remember the massive hype around this being the "next email." I excitedly got as many of my friends onto there as I could.
I can't really pinpoint any one thing. There really was a mass of mistakes that all lead to this imploding heavily. I seem to recall that the fate of GWT was intertwined heavily with it. Very heavyweight widgets to support the general idea of massive collaboration in real time.
I suspect the killer is that "real time" portion. People love to talk about that. Few actually want it. (Fewer still need it.)
Pretty sure the biggest mistake was the same as Google Plus': the invite system that artificially hampers growth.
Since these platforms need to capture an entire network of people at the same time if there is something preventing someone from bringing all their friends/collegues in at the same time then it is doomed to fail.
Yeah, this worked fine for Gmail's early years because you can talk to people on other email systems. But Google tried to apply the same system to both Wave and Plus where the exclusivity made them comparatively useless.
I think they've learned the lesson by now at least, since their latest communication systems (Duo and Allo) had open signups. If those two fail it'll be because they were pointless (from a user perspective) entries into a crowded market of established players who already had network effect lock-in working them.
More than just the invite, I think they really soured a larger portion of their market than they thought.
The impression seemed to be that they would kill buzz/reader/wave, and the folks would just naturally turn to what they then offered. The reality seemed as much that many of us were unwilling to try anything else from them until it was clear it was good and going to stick around.
Do you have a source for this? I don't remember it ever being part of Gmail.