Google to develop email ad product?

The wired world will hear the sound of many shekels clanking if Google is indeed developing an ad product to include in emails, as a Reuters story reports. Specifically, Google is focusing on how to deliver advertising to a user when an email is opened, the story reports. While Google AdWords are already running in a number of newsletters, the amount of revenue Google could potentially develop from a new email ad–conceiveably even more contextually relevant than the current keyword served words–is staggering. Given that recent acquisition Sprinks has the capability to serve ads as emails are opened, this new product doesn’t sound like vaporware.
As the Reuters story points out, it may be that Google is also planning to launch its own free (and presumably guaranteed spam-free) email service at Given the number of Google users, it’s likely that a free-and service-rich email service–could quickly rival Yahoo and MSN’s.