Web services are an integral part of creating most enterprise-level web applications these days. They provide access to services that can't be accessed directly on the client side due to security restrictions. For example, you could have a web service that accesses a database to retrieve or store customer information. Web services can also provide centralized operations that can be accessed from many different applications. For example, a service that supplies weather data.
Web services can be created using any server side technology that can get a web request and return a response. It could be as simple as PHP, or as sophisticated as a service-oriented architecture such as .NET's WCF API. If you are the only one using your web service then PHP may be sufficient; if a web services is designed for public consumption, then maybe not.
Most web services provide data in either XML or JSON format. In the past, XML was the format of choice for web services. However, in recent years...