Why do you care what products Google uses internally? Without knowing anything about your intended use case, Google are likely facing a pretty different set of requirements, and they probably have a very different set of resources (e.g. they obviously have a lot of in-house expertise on how the Google Apps suite works).
Gmail runs on the Google GFE/1.3 server, which is hosted on a Linux Operating System.
See here <a href="http://en.wikipedia.org/wiki/Gmail" rel="nofollow">http://en.wikipedia.org/wiki/Gmail</a>
Exchange email is acceptable but not outstanding. The reason that most companies end up with Exchange is the good calendaring support.<p>Try your free or less expensive options first and see what your employees think. At our company (back when we were a startup) our first IT hire's first job was to install Exchange -- the executive team was absolutely done with the inferior product that we were using before it.<p>Another reason you may wish to not use a hosted environment: your company's data can't be monitored or revealed by a subpoena to the hosting company if there's no hosting company. You can be sure that Google complies with subpoenas and court orders unless they're laughably vague and potentially useful for a PR stunt.