What is the difference in a nutshell? Why would TPTB cancel pop3 service to my Outlook and demand I change to imap? Does it save them anything?
This Wiki article has a good list of the advantages over standard POP3. Basically, it’s a lot more advanced; POP3 is extremely simple in its implementation (it’s been around forever) while IMAP offers a lot more features better suited to modern ways of sending and receiving E-Mail.
Filtering out everything in the linked article, the biggest thing you’ll see as a user is the ability to maintain your email folders – including sent messages – regardless of the email client that you use. For example I have two computers at home, each of which runs multiple operating systems. Because I have IMAP on my web hosting account (which is my primary email) I can use any computer, any operating system I want without worrying about this message being here, that message being there, which computer did I send that message from so I can see it, and so on.
Some ISP’s block port 25 for email and insist you use their stupid SMTP server, which will screw up your sent messages in IMAP. My particular host has several other SMPT ports set up to get around these blocks, though, so consider that if you get frustrated in trying to use IMAP. I have Comcast which blocks port 25, so I use port 26.