First, the Tentpole features:
1) Multitasking - Perhaps the single most requested feature of the iPhone. Multitasking allows for users to switch between multiple Apps by tapping on the home button twice. Any apps currently running in the background will appear in the iPhone's dock. From there, users can choose between Apps. Games will pause while in the background, and will start again from the point you left off.
2) Folders - Another much-needed feature of the iPhone. As anyone with 10 pages of Apps on their iPhone can tell you, managing all of the icons can be a laborious task (OK, maybe laborious is a bit of an overstatement, but it's definitely not fun flipping through all those Apps). iPhone owners simply touch an App until all the icons start to vibrate. Then, dragging one icon into another will automatically create a folder housing the two Apps. Most will likely want to keep similar Apps grouped (i.e. games, productivity, news and entertainment) which should greatly reduce the number of pages on the iPhone home screen.
3) Improved email - All of your emails will now come to a single, unified inbox. For those who want to check each email address individually, there is fast inbox switching.
Image from Engadget
4) iBooks - The App that seemingly puts the iPad in direct competition with the other eReaders out there, iBooks. This App is similar to its big brother on the iPad, but with scaled down graphics and no page-turn animation. Like Amazon's Kindle, the pages of your books will sync between devices.
Image from gdgt
5) Enterprise features - OS 4.0 adds better data encryption in email, and ability for developers to encrypt data in their Apps. Also available is mobile device management to help larger companies manage the deployment of iPhones across employees. Companies can also distribute their Apps to staff wirelessly anywhere in the world rather than the employees having to log into the iTunes Store. Though to the rest of us this doesn't mean much, it may be a welcomed feature to businesses using the iPhone.
6) Game Center - Game Center has been most commonly been referred to as Apple's take on Microsoft's Xbox LIVE network. It's going to give iPhone gamers a chance to play online against each other, invite others into games and post scores via online leaderboards. As the iPhone and iPad become more prominent gaming platforms, features such as these will become more widely used by players.
7) iAd - iAd is a new format for mobile advertising that will compete with Google's AdMob. In the demo Jobs showed during the iOS4 unveiling, he presented an interactive Toy Story ad (which Jobs added was done in HTML5) that had everything from simple minigames to nearby theaters.
Everything Else:
8) Home Screen Wallpaper - This feature is already available on the iPad, and to those who jailbroke their iPhone (then again, many of these are). You can now change the background on your home screen. Before, this was only allowed on the lock screen, but this adds an extra level of customizability to your iPhone.
Image from BGR
9) Search SMS - Pretty much what it sounds like. You can now search your text messages. This may come in handy if you have to look for a past conversation.
Image from Gizmodo
10) In-App SMS - Thank you, Apple. Nothing was more annoying than playing a game or reading email or any of the other task carried out on a daily basis when an SMS text pops up and you choose to answer back only to be exited out of your current App and into the text window.
11) Tap to focus in video - Much like the iPhone 3Gs did with the camera that allowed users to focus when taking a picture, OS4 will add a way to tap to focus while recording video.
12) Orientation Lock - Awesome new feature that will keep your screen from rotating when you move your iPhone. Especially useful for reading while lying down.
Image from BGR
13) Spell check - The iPad already has this feature, but the iPhone just takes it upon itself to correct your word. Spell check will put that familiar, red dotted line under the offending word.
14) Resize Photos while emailing - Sometimes when you take a picture of something and want to shoot a quick email to a friend, you want to resize it to minimize not only its physical size, but its file size as well. Now you can resize photos within an email message before you send it off.
Image from Gizmodo
15) Create playlists - On-the-go is a thing of the past in iOS4. This feature allows the user to create and name playlists that will sync back to their iTunes.
16) Nested playlists - Nested playlists are playlists within' playlists. The easiest way to describe this would be creating a playlist called My Rock Music, then creating playlists within that one called Grunge, Industrial, Punk, 80's Rock and Goth Rock.
17) 5x digital zoom in photos - This will let you zoom in on photos up to x5, but unlike an optical zoom, there are often visible artifacts to a digital zoom.
Image from Cnet
18) Gift Apps - This is already possible through iTunes, but this will make it possible to purchase Apps for friends via your iPhone.
19) File and delete mail search results - Though not yet explained, seem to be nothing more than a way to do an email search and manage email.
20) iPod Out - iPod Out gives users connectivity to their car stereos. When connected to the stereo, the user gets a simplified iPod interface that allows easy navigation.
21) CardDAV - Access and share contact data on a server. Could be useful for offices in which company phones are issued.
22) Birthday calendar - Tired of forgetting birthdays? Always feel like that bad friend who forgets to call someone on their special day? This feature may help.
Image from Cnet
23) Tethering - Connect your iPhone directly to your computer for internet access via your cellular provider.
Image from Everythingicafe
24) Persistent Wifi - Your phone will remain connected to a wifi hotspot, even when in standby. No word on how this will treat the battery, though.
25) Bluetooth keyboard support - Sync a wireless Bluetooth keyboard to your iPhone for easy typing. Cool feature, but we don't know how many people will connect their iPhone to a full-size keyboard since they likely have a computer to go with it.
26) Geotagging in photos - Your photos can now be grouped by where they were taken in the world, and can be mapped.
Image from Apple Insider
27) Character count in SMS - Sometimes we text a bit longer than we mean to. That leads to messages that just cut off. Now you will know exactly how many characters you have typed as you compose your text message.
Image from iPhone Hacks
28) Cellular Data On/Off - Turn off cellular data. Perhaps useful when traveling overseas and trying to avoid huge data charges.
29) Search Web or wikipedia through spotlight - Currently, when you use your iPhone's search, it only looks through what is on your phone. Now the search will include the web and Wikipedia.
30) View documents without the iPhone border - This hides onscreen info on the iPhone when viewing a document. This adds a little bit more viewing space when reading on your iPhone's small screen.
Image from Gizmodo
31) Updated "New Contact" Screen - Streamlines the New Contact menu by putting more options on one screen.
32) Organize photos by faces - Uses facial recognition to sort photos. Wonder what it does with identical twins...
33) Zoom - Allows users with limited vision to zoom in on items for added accessibility.
Image from iLounge
34) Up to 2,160 visible Apps - previously, you could only have 180 Apps on the iPhone at a time (that was a lot of page-turning). Now, through folders, which can each hold 12 Apps, you can have up to 2,160 Apps in your home screen.
35) Choose Which Apps Use Location Services - you can now specify which Apps use location services. Most likely useful for privacy.
37) Email threading - This is part of the improved mail Apple talked about during the unveiling. This will keep emails within the same subject line (such as replies) in a single thread. Making the iPhone's inbox much more manageable.
37) Longer passcodes, Alpha-numeric - The old lock screen used a four-digit code. iOS4 has longer codes and adds letters.
38) Unified Inbox - Another part of Apple's improved mail App. Users who have more than one email, such as one for work and another for personal use can have all their email arrive in a single inbox in their mail application. Keep in mind that the user can also easily choose one inbox if they only want to see the contents of that particular account.
Image from Cnet
39) Contact Pictures in emails - Contacts photos will appear in email.
Image from Gizmodo
40) Folders in Dock - Keep folders you create in your dock for easy access.
41) Custom Dictionary - Add words to the iPhone's word bank. No more corrections of words you didn't need corrected.
42) Easily Add Events to iCal - Dates and addresses will have links that will allow the user to easily add them to their iCal.
Image from Gizmodo
43) Double-Tap and Hold for Favorites (Home Button) - Previously, one had to double-tap to bring up their favorites. Now, double-tapping allows for selecting background Apps in multitasking. The new solution to bring up favorites? Double-tap and hold.
44) Notified when SMS fails to send - Lets you know when your SMS message doesn't reach the sender.
Image from Gizmodo
45) MobileMe Note sync - It's all on the cloud. MobileMe users can now sync their notes to other devices.
46) In-page quicktime playback - Rather than the phone switching to an App within the internet browser, this will let quicktime videos play directly in the web browser.
Image from Gizmodo
47) Youtube in portrait mode - Though we don't know why anyone would want to do this, the option is there. Instead of watching Youtube videos in landscape, you can now rotate the device and watch in much smaller portrait mode.
48) Choose Keyboard layout - Choose between QWERTY, Dvorak and other popular layouts.
Image from BGR
49) CalDAV invitations - Likely the ability to send and accept CalDAV invites on iPhone.
50) Wake on Wireless - Set the iPhone to wake from standby upon coming into the range of a wireless network. May become annoying when driving through the city.
51) Upload Workouts to Nike.com - For those of us who actually exercise.
52) Top Hit in Search - Works within the spotlight search. For example, if you often listen to Billy Idol on your iPhone, the second you type in the letter B, Billy Idol will appear at the top. In other words, it searches based on what you use most.
53) OS-wide multitouch - This is multitouch throughout the entire iPhone OS. Features such as pinching to zoom in and out used to be limited to Apps, but this is something that can allow for that to be used anywhere on the iPhone, even the home screen.
54) Recent Web Searches - This seems to mean that your recent web searches will appear in spotlight.
55) Face Time - With Face Time, you can have a phone conversation while watching the other person on camera. The future is here. The limitation is currently wifi-only.
Image from Apple.com
56) iPod Widgets in Dock - This is simply basic iPod controls within the iPhone Dock that allow for quick control of the iPod functions on the home screen while music is playing.
Image from Gizmodo
57) Web search suggestions - This is similar to what google does when you are entering text in their search bar. For example , if you type, "Nin," you will see choices below such as "Nintendo," "Nintendo DS" or "Nine Inch Nails" as it tries to guess what you are looking for based on popular searches.
Image from Cnet
58) Word Suggestion - As you type a word, a drop down appears that lets you choose other possible words you might be thinking to type. It works much like the aformentioned web search suggestion.
59) File Sharing (to computer) - Connect your device directly to your computer and share files directly between the two.
Image from BGR
60) Closing Background Apps - When multitasking, background Apps will show up across the bottom of the screen upon tapping the home button twice. By holding your finger on a background App, you will activate a little minus symbol that will let you close multiple Apps at once.
61) Large Text - Scale up text for more accessibility for those with limited vision.
62) Choose a Search Engine - Remember the rumors that Apple was going to ditch Google in the latest iPhone OS update? Well, Google is still here--so are Yahoo! and Bing.
63) Alerts on App Folders - When you get an App alert in an App within a folder, an exclamation point pops up over the folder. When this happens, you can open the folder and check the App.
64) New Wallpapers - Some of the older wallpapers are now gone, but there are new ones that may be to your liking.