Basically, it lets you take photos from the album on your iPhone (or iPad or iPod Touch if it has a camera) and turn them into a digital story book with text. (You can even include a couple of short video clips too if you want.) The finished product can be shared in the same way as StoryKit stories - when you share your story, a version is uploaded to a website with a random address on the Story website. Only people who know the address can view the story - when you upload your story the app asks if you want to share it via email or Facebook. You can also embed stories on your website.
The stories you create are based on events in your photo album. If you want to use photos (or video) from your computer you'll have to move them over to your iDevice first. You can let Story choose the images from your event for you, or you can create a story from scratch if you want more control over the choice or need to choose photos from more than one event. Story will automatically title the story based on the date and the location where the photos were taken, but you can edit this (within the 50 character limit.) You can add text - either on its own on a page (150 character limit) or as captions to specific photos (75 character limit.) I found when I added a caption to a photo it appeared in the app not to fit properly even though it was within the 75 character limit, but after I uploaded it to the Story website it looked just fine. You can't (as far as I know) change the font, font size or color. The first word in a text box (not the title or a caption) is bold and you can't switch that option off.
You can change the 'theme' or background - this is where Mickey is one of the five available options, but if it weren't for that you wouldn't know this app has anything to do with Disney. You can change the page layout, and also crop individual photos. I didn't find it obvious how to change the layout, but once I figured it out it was really quite easy - drag pictures from page to page, drag extra pictures to page to change the number of pictures on a page, and tap on a picture to get a popup menu that includes the layout option. Stories are saved in the app, and if you use iCloud they are backed up there too.
Although you can add video, you can't add audio the way you can in StoryKit and there are definitely occasions when I want my students to record themselves reading their stories.
You need to set up a Story account in order to be able to share stories. The account name (but not the email address you use to login) that you provide will show up on every story that you share. You can edit the name later if you need to through the account settings in the app. You can create stories without being logged in to your Story account, but to share them you have to log in. I would recommend having students create stories and then have the teacher log in to share them once the students have finished work. This way stories don't get shared until you know they are worthy of being shared, you know who they were shared with - and students don't have access to the account settings so they can't change the password on you!
Here's a very thorough review of Story from Macworld. Disney has a FAQ page for the app that answers a lot of the questions I had about the app before I even downloaded it.
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