When Apple introduced FaceTime alongside the iPhone 4 introduction in June 2010, it was used very little. I believe this was the case for two reasons: 1) people had a hard time finding an application for its use and 2) at the time, it only worked over WiFi. Since then, AT&T and other carriers have relaxed their restrictions to the point that yu can now use FaceTime over 4G and LTE on the go. Now, it seems like FaceTime is used more frequently (I use it just about every day, and it's becoming more frequent).
FaceTime is a Voice over IP (VoIP) communications service that allows you to communicate with another FaceTime user using data, rather than traditional cellular service. Currently, FaceTime is supported on Apple devices (iPhone, iPad, iPod Touch and Mac computers).
With the release of iOS 7, Apple included the option of using voice only for FaceTime calls. This is great for those people (you know who you are) who don't like to see video of either themselves or the other person. Sure, you can just make an old-fashioned telephone call, but here's why this is a big deal.
Believe it or not, there are still some parts of the world who don't have good cellular coverage for certain carriers. For example, when I visit my sister in the Phoenix, Arizona area, she lives in a new subdivision that has zero AT&T service. She does, however, have great WiFi service within her home. Before FaceTime was an option, I instructed people to contact me via email. Obviously, this was a clunky solution.
Now that FaceTime is here, those who need to get in touch with me in a situation like this have lots of options. Not only can they contact me via FaceTime video, but voice-only as well. In other words, it would be just like a regular phone call... but using data instead.
Another great use for FaceTime... iPod Touch. With FaceTime, you can purchase an iPod Touch for your son/daughter, and as long as they have WiFi access (which is probably most of the time these days), you are able to FaceTime them using video or voice... all without a monthly bill.
I would personally be quite happy if everyone who contacted me via voice/video would use FaceTime (if you haven't noticed, I list my FaceTime contact information as well as traditional contact information on my contact page for this very reason). We are definitely in an era now where data coverage is greater than cellular coverage used for simple phone calls. Looking down the road 5 - 10 years, I believe that most frequent communication will happen this way (communication via data), and that phone calls as we know them today will become less common (eventually going away), being replaced with VoIP solutions like FaceTime, Skype, etc.
In my opinion, there are two things missing from FaceTime that would make the system absolutely perfect. Read what they are here.