It's easier to carry a phone around (and the fact that I would be carying a phone anyway)than a laptop or something. Internet-on-demand has a plethora of uses. Not to mention GPS, improving picture/video quality, app functionality... I could go on and on.
I've spent a few months shy of HALF OF MY LIFE in the Navy and I go to sea a lot. Watching movies on a tiny screen is a turn-off for most, but convenient for me. I can just roll over and go to sleep with it still in my rack (and it duals as an alarm clock). Can't do that with a laptop or I'd break the LCD in my sleep.
Not that I own an iPad, but it actually does have *decent* input devices. A keyboard dock, for one, and a controller-like gizmo that you can 'stick' to the screen.
Just broke my personal record for number of consecutive days without dying!