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The basic explanation of Augmented Reality is to superimpose graphics over real-world environments in realtime. In Flash, this is usually done with a webcam and a marker card. When you hold the card up to the webcam, Flash is able to detect the orientation of the marker and superimpose, in this case, a 3d model on top of it. This technology has been around for a while now and having access to it in Flash is really exciting. Although it is still in its infancy, over time the speed and power of AR will improve to hopefully play an important role in how we view the web. Now is a great time to get your feet wet in order to get a better understanding on how it works.

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What's your take on the iPad? (Putting aside the Flash/iPad flame war)

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