When we told you about the iPhone, one of the problems we listed was that iPhone implements what we refer to as 'tivoization' -- that is, refusing to run software that has not been deemed appropriate by the ruling body, even if the software is permitted to be changed, legally, by its developers.
If there is no signature or if the signature is invalid, the iPhone will refuse to install the software. If the software has been modified in any way, the signature check will fail. The signature check is also tied to the user's specific device, which means that she is not permitted to transfer or copy downloaded programs directly between iPhones, and any other copying is permitted or not permitted at Apple's whim. This system of rejecting software that doesn't pass a signature check -- even when modifications to the software are legally permitted -- was made famous by TiVo, and so is called "tivoization".