Google ME is a new service which allows Google users to provide profile information so that in the event that someone Googles your name, you have some input into the results that they see.
The profile is included in addition to the search results, not instead of them, so the "search" aspect is not entirely co-opted. It's still somewhat unsettling that this will change the nature of googling. We expect Google to find what is out there according to their search algorithms, not any individual's input.
If the service does gain traction, the value to Google of the personal info that will be collected could result in dozens of add-on products and services.
The downside might be that this brings us one step closer to a Google backlash over privacy concerns. Between your search history, viewing habits, shopping tendencies and now added profile information, it may be only a matter of time until someone or everyone decides that Google has too much information.