I wish people would understand what this is.
It's an ad platform which developers can choose to implement into their apps. Instead of running their own ad services, they can use this one, which has much more extensive knowledge about the user (as it knows the user's activity across the entire Xbox platform, and any other services which you use your gamertag on (Zune, GFW, WP7)), and, as such, can deliver much better ads targeted towards you.
Apple have a similar scheme on the iPhone.







