AppleCare is the name of Apple's extended warranty program. Buyers of Apple products from Macs to iPods, Apple TVs to iPhones are able to extend the warranty their purchases come with by buying an AppleCare protection plan. AppleCare includes both phone support and hardware coverage.
The price of AppleCare is different for different products, though the more expensive the product the more its AppleCare generally costs.
For iPods and iPhones, the standard warranty is one year of hardware support and 90 days of phone support, which includes a single phone cal for tech support. Additional calls require a fee.
An AppleCare protection plan can be purchased to extend support up to two years as long as the device is still within its original warranty.
Besides the traditional AppleCare plan, Apple also offers an enhanced product called AppleCare Plus. It includes all the standard AppleCare features, and adds repairs for two incidents of accidental damage during the two-year term of the warranty. Each repair has a $49 fee attached to it, but that's still likely cheaper than most repairs. AppleCare Plus for the iPhone costs $99, a little less than double the traditional AppleCare for iPhone.
In order to put an AppleCare protection plan into effect, the buyer can register with Apple either online, over the phone, or via mail.