What is iMessage?
iMesssage is Apple's new messaging platform / application specifically for iOS 5 users. Similar to traditional SMS text messaging and MMS messaging, users on any device running iOS 5 will be able to send text, picture, and video messages to each other via iMessage.
In short, this brings text and multimedia messaging to the iPad and the iPod Touch -- devices which previously only gained this ability through fairly clumsy third party applications.
On the iPhone, iMessage is built into the Messages app, so messages you send to other iOS 5 users will be sent via iMessage, while messages sent to owners non iOS 5 devices will be sent as a traditional SMS or MMS message.
iMessage also features advanced capabilities such as a typing indicator and delivery / read confirmations. iOS 5 users can send unlimited messages via iMessage.