A theory I have been toying with (I am sure many are toying with) is that inbound links will be seconded to the weight Google will give you from the pages of Twitter and Facebook. Lets face it, nothing is more important than a Social endorsement. It would be the same reason why DMOZ for many years was the most coveted and most powerful inbound link, because a human had to endorse it.
The social space does pose a problem for Google if they are going to try and bake it into their algorithm. People use �Tiny Urls� for the most part, so they will need to start crawling these links. This issue could explode as SEO�s will manipulate this to their own benefit by spamming the social sites, which already have a huge issue on their hands. Also, many people wont link to sites with the proper �Anchor Text�. Google would need to read the conversation and decide how to decipher relevancy from it.