Watson is a super computer programmed to be what is basically a search engine that understands human speech. You can ask him a question, or phrase it in a certain way, and instead of searching for keywords over the internet, he analyzes your query and comes up with a direct answer from the database of information he has within himself.
At the time of this post, they just finished "testing" Watson by putting him through a two day, three part jeopardy game with the two best players to ever grace the answer-question stage. An excellent choice on their part as well, since Jeopardy is well suited to testing basic language comprehension skills. google can answer almost any question you have for it, but it has a hard time giving you a question for an answer you provide. I won't give away who won here, though.
As for why Watson is important, think back to the early days of television. Back then robots appeared as everyday human beings with extraordinary attributes such as amazing strength or speed, or even being a living calculator or encyclopedia. We have yet to make compact enough technology to fit a super computer in a human sized contraption, but as far as the mental aspect of giving a robot free will or secular thought, Watson is a step in the right direction.
By doing this, creating a computer that can understand thought, we're looking closely into how the human mind works. When we've created a robot that fully functions almost exactly like a human, it means our understanding of the human body and mind has grown exponentially to the state it's at now. By pushing forward in the direction Watson takes us, it could ultimately lead to us creating ways to cure brain damage and other permanent disabilities. the world of people with robot legs and arms in place of lost ones is inching closer every day, with all the excitement and terror that brings in tow.
But as with every advance in technology, watson has it's flaws and risks. if something that powerful were to go haywire or short-circuit, how much would that take to fix? how dangerous could it potentially be? I'll sign off this post by saying to keep your wits about you, but look with hope towards the future. With Watson, a whole new world of possibilities is slowly opening up.
