Because it's a buzzword, and buzzwords tend to be used with different meanings by different people. I've had this discussion with a friend as well, and it comes down to what technology you prefer.

Using XML for storage is not unpopular, and I wouldn't go so far as to say it's not what xml was meant for. One area where it shines: Single-source publishing, for example DocBookXML. You write the document (or a complete book) once in one format, and then it can be easily and automatically translated into html4, xhtml, pdf, rtf, ps, wml, etc. etc. (at least in theory - most people fail in trying to get the proper environment together in the first place)

Of course that is neither unique nor brand new. There have alway been plenty of converters for (la)tex for example, but those were all applications that were written once and only for one purpose. With XML and the surrounding standards and tools, you write a document and it's "specification" and then can let it be translated by whichever application in whichever language you want - as long as it supports the same standard. At least in theory.

Practically however, things are not nearly as easy as they are sometimes made out to be. I remember wanting to use XML for one application a few years back, and it turned out that a) my language of choice had sketchy xml support b) didn't support Schema validation at all c) DTDs were way to weak to be useful d) there were no editors available that I would have wanted to put into user's hands (most of which also had only the very basic xml-support - too little to be useful).

I find the XML concept intresting and it could be the next big thing
I had to laugh really hard, when i read that. Beause it alrady was the next big thing several years ago, only the promises that were made were (IMHO) never really fulfilled. But it looks a lot better today than a few years ago, it might actually be possible that we get there someday...

What really p'd me off, was the fact that XML inspired so many Architecture Astronauts to build hideous things like the WS-* mumbo-jumbo. Or all the people that use XML-Files for configuration (in fact, I even did that myself back then, and I feel ashamed for it ). XML is just way too verbose for that.

Many places where XML is in use, you could do well without - it just introduced an unnecassary layer, as you can see in the many XML-RPC vs REST discussions (or not, depending on which side you're on). This russian-doll type layering is humorously illustrated in The essence of XML.