The app for Xbox Live users has recently been updated and it's a pretty significant update from what was previously offered. So significant, that it has its own name and there's a tutorial video showing how awesome it is. Xbox Live users who don't have the app will definitely want to check this out.
The app is now called Xbox Smartglass and lets you interact with your Xbox console from your iPhone or iPad in ways you couldn't before. The app allows you to navigate your Xbox 360 by swiping and tapping your device. You can use your iPhone or iPad's keyboard to type messages, a big improvement over using the controller.
You can browse the internet on your 360 from the app, control music being played, search the Xbox catalog and more. It's such a significant update with so many new features, that Microsoft made a video showing off how this is a must have app for Xbox users.