There is one major limitation when sending out legit mass emails via SMTP ("compose") - a daily cap on the number of emails allowed to be sent from a mailbox. This applies to most e-mail service providers.
Google Apps Standard, the free edition, allows a maximum of 500 outgoing mails per day for each user id.
Even the Primier edition which costs $50 per user a year limits outgoing mails at 2000 per day for every email id.

There are two cost-effective ways to send out newsletter emails via Google's services - Google Friend Connect (GFC) and Google App Engine (GAE).

Google Friend Connect

A lot of people are not unaware of the fact that you can actually send out newsletters for free to your subscribers via Google Friend Connect (GFC).
The catch is that the users have to be susbcribed exclusively via Google's Subscribe button without which there is no way for the newsletter to reach the user.
This is really a tough catch as you got to have it's subscribe button right from launch date.
Its a major turnoff, especially when a website collects registration infomation via a form and sends the data to a database, after which emails are sent separately.
Most email marketing systems like aweber, mailchimp, emailbrain, constantcontact, madmimi etc have the option to add subscribers manually externally.
And with GFC, you would not be able to retrieve the subscribed users' email ids via the control panel - export gives only names, ids, open id urls and thumbnail images.
So, at a later point in time, if you decide to switch to another email marketing system, you would need to send one last email asking them to re-subscribe to a new system.
Another bad news is that the subscriber's email address must be an open id ! (google a/c, yahoo a/c, twitter, AIM, netlog or any other openid)
Looks like all bad news, but if you think from the users' perspective, this is a good deal.
Its secure since there is no way for emails to be leaked accidentally.
Its safe because there is no room for errors in accidentally sending out mails to users who have unsubscribed.
Regarding the sender / from email address - It would be the same as the google account username. So if you don't want it sent from myusername@gmail.com, then create a google account under your app id. (This dual account chaos would be resolved soon : Google Apps Accounts Will Also Be Personal Google Accounts)
GFC is straigtforward, only bit of major work required is getting the audience to hit the google subscribe button.

Google App Engine

If you are not convinced with GFC then check out GAE - Google App Engine.
It has a daily free quota of sending emails to 2000 recipients. Link
After that, its billed at $0.0001 per recipient - thats just $1 for sending to an additional 10,000 recipients which can execute in about 2 minutes ! Link
But you've got to code to take advantage of GAE and your website should most probably be powered by GAE as well.

Google Groups

Then there is always google's mailing list at google groups.

But this cannot really be act a newsletter system.

If you want to submit ideas / suggestions to the Google team for its products, you can submit or vote at Google Product Ideas which is open to the public.

When Gmail was first launched in 2004, its most attractive features were fast AJAX interface and POP+SMTP ! Though Microsoft Email clients like Outlook & Express managed to emulate POP & SMTP for Hotmail accounts, POP+SMTP was not really available. But above all, it was Gmail's initial 1GB and growing storage capacity what really lured people to using it. By 2007, with space of almost 3GB and 10GB for the paid versions, Google has recently increased their capacity to 4GB (targetted to 6GB by Jan '08) and 25GB for paid versions.

And now for the most anticipated feature of all - IMAP. Thats right. Google has just started rolling out IMAP for gmail accounts. This may not come as a very big excitement for most users, but it definitely does for developers who can now access gmail accounts directly via the IMAP protocol. The only other free service that was providing this so far, was AOL.

There may have been a lack of new services by Google this year, but if definitely seems to be improving their existing ones dramatically. After all, it reached the $600 a share mark a couple of weeks back and is close to $670 as of now.

I was shocked when I saw the newsletter email from Burrp.com, titled Local SMS Alerts from burrp.com. Instead of sending it one at time to each individual, they CC'd it everyone in the group ! This leak could've been goldmine for spammers and other internet marketeers ! could've been did I say ? I was further shocked to learn that there are only about 450 users registered under Burrp Mumbai !

Burrp is currently all about a local search for restaurants, bars, nightlife, street food, juice centres, desserts, bakeries etc - which is what this very city is built upon. The reason why this 'seems' so overly-crowded is because of the excess fat in most of the Mumbaikars (no offence, just a view). They're soon on the way to becoming Indian version of citysearch.com, listing Cinemas, Theater & Dance, Museums, Art Galleries, Spas, Salons, Gymnasiums and Book Stores. Food and drinks being the backbone of this city, a potential site like burrp.com could've done much better marketing - instead they've now got a tougher job of marketing as result of this breach of privacy. Trust is very important factor when signing up for a service - esp when its a free one. That's why I have a separate email for all public community related websites.

Anyway, thanks for list Burrp.

Update: A similar incident seems to have taken place with an upcoming website called Nivio.

Spam is now skyrocketing never like before. Its been the latest talked about issue for some time now. We are all dealing with a great amount of spam these days and blocking email addresses or entire domain names are not going to help in the long run for the end user. Email services like Gmail, Y! and MSN have are spending tons on anti-spam algorithms. Recent trend is spam emails are sending in an image containing the spam text while the text within the email contains actual well-formed sentences, on mostly general-knowledge that has nothing to do with you. Email text no longer has words like 'viagra' or 'broker', but real meaningful sentences. Its the image with all the rainbow colours that contains all the junk (wordings) with the click-link to their site. Most of these spam mails have a purpose - for you to click the link and either extract some confidential information from you or just to know if your email address really exists and still active. Either way, once you click the link you they store the information on their server. Heres a recent email I got which Yahoo didn't mark as spam. There are some spam-mails that have no images, no links - just pure meaningful 1-2 lines of text that has nothing to do with you and yet spam - and yet it may sound like its someone you may have contacted before. Whats the point in sending out these kind of emails without being able the track us in some linked-way ? I don't know, but maybe there'll be higher replies for such emails thus verifying the your email ? The email I got definitely is useless since it mentions "virus-free version" ! Had it been "pdf version", it would've been more believable. Moreover, the sender is "sexy james" which itself means 'spam' thesedays. Don't accept mails from addresses having 'sexy', 'honey', 'hottie' etc. If your friends got addresses having sexy-cool names, encourage them to use proper email addresses. Two years ago, one my college classmates attended a job-interview and when the female HR asked for his email address, he replied (seriously) "honey4you83@..." ! At the end of a successful interview if you give your email address bitchinbabe@yahoo.com, what do you expect from the HR, Yahoo Bitchin' Babe, you got the job ! ?