"Jailbreaking" is the process of using third party software (evasi0n, redsn0w, etc.) to install an "app store" called Cydia. (created by Jay Freeman) This allows the user to personalize the phone with themes, tweaks and other apps. Also, it provides a developer with a good idea a platform to sell products that allow the phone to do things it usually couldn't. These include: setting up personalized actions to activate certain apps, play/pause music, etc.; allowing the user to change the overall theme of the phone; allowing the user to download antivirus for their phone, as well as many other useful things. The DMCA has now made it near impossible to jailbreak any iDevice by not allowing tablets (because there is no strict definition) and not allowing phones if bought after a certain date.
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