The planned Global Precipitation Measurement (GPM) mission beckons hydrologists as an opportunity to improve flood prediction capability for medium to large river basins, especially in the underdeveloped world where in situ precipitation gauge networks are sparse. However, before the potential of GPM can be realized, there are a number of hydrologic issues that must be addressed. In particular, we argue that unless there is a shift in paradigm, the conventional assessment frameworks and metrics for estimation of precipitation from satellite sensors will remain inadequate for hydrologic purposes such as flood prediction. We also argue that greater emphasis must be placed on development of hydrologically relevant precipitation estimation algorithms and that this will require involvement of a broader cross section of the hydrologic community.