It's a product with very little traction and an inferior experience to what's already in the market(twitter, fb).

Unfortunately pockets of traction for a product as old as Buzz means very little. Social for big guys like fb and google is about scale, not niches.

it depends on what you mean by "experience." I think buzz is easily superior to twitter, but I use twitter because the community I engage with is there.

does the existence of picasa's online albums somehow harm google because only some people use them?

Here’s my discussion on the Buzz user experience, from a year ago. http://alanhogan.com/buzz-is-already-dead

(tl;dr: Too distracting, not very skimmable, awkward social aspects including too many non-friends showing up.)