It differs from HTML in that there aren't really any tags that are reserved for anything. XML can be considered to be simply a generic tree description language. Many many many things. Specialized viewers can be built that understand how to render the information in an application specific kind of way. One example is MathML, which defines a set of tags that can be used to describe mathematical expressions.
Chemical engineers use an XML derivative to exchange molecular information.
Clearly, this is a big win over proprietary protocols. Even if you're dealing with a set of data that isn't highly regular, e.g. web site content, XML can still be quite useful by keeping the site's content separated from the site's design. This has many positive benefits. It allows people not familiar with HTML to easily edit the content of the site. It allows for rapid site design and redesign, since the content is not mixed up in the stylesheets and since many XML files can share a single or set of XSL stylesheets.