It's an alternative to IMAP, but it's more limited than IMAP, so it can't be used to create an email client. It's best suited for apps that send email programmatically, apps that index email, apps that monitor your inbox or any other Gmail label. It was created for services like Boomerang that schedule email to be sent later, mail checker extensions like Checker Plus for Gmail or CRM services like Insightly. The new Gmail API is faster than IMAP when retrieving a thread or performing a search, it provides fine-grained permissions and it lets you query change history to keep mail in sync.
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