The upcoming iBooks app/store on
The Tablet the iPad is, like all of Apple's content offerings, based an open standard with a sprinkling of proprietary DRM. The ePub format Apple's using is a free, open, international standard that's also used by Sony's Reader devices, and the popular Stanza iPhone app.
Note that Amazon has hedged their bets pretty well: while their Kindle devices/apps can't read ePub content, the company not too long ago acquired Lexcycle, the company that makes Stanza. The vast majority of e-books sold today are for the Kindle, but with both Apple and Sony supporting ePub that's poised to change, and Amazon's already positioned themselves for when/if that happens.