An email group is one address which goes to many others. You might have one address for your family, but anything sent to that address would go to each family member.
It does something similar. You're the only one who can send directly to groups built into your email program. If you want others to do so, your group has to live in the cloud.
There are many alternatives which can do everything you need. But they're much harder to use. With those products you have to first invite each person. And then they have to accept your invitation. If they forget, or miss the invitation they'll never get added to your group, so you end up chasing down each member one by one. GroupMail signs up new members in one easy step