[Osmose]

1. Public/private key authentication is, as of 2009, still not something the mainstream internet user can figure out to do easily. I'd guess most don't even know it exists.

2. I can also delete a lifetime of mail in 10 seconds. The steps required to redundantly store or back up data require either knowledge the layman doesn't have or expensive software (assuming they don't know of the free alternatives).

3. Letters are like books in that there will always be people who prefer the personal feel of paper and ink to a computer screen.

4. Agreed.

You seem to be assuming that his market is YC users or other techies. As stated in other comments, this has great applications for the elderly, non-techies, and people in other countries wanting to send mail to the US.