There are many reasons why you would want to shorten or disguise your various URLs. The obvious reasons are masking an affiliate link so that people won't know it's one also to shorten those extremely long URLs that get broken up in emails.

This is a url from amazon:
http://www.amazon.com/Canon-HV30-Definition-Camcorder-Stabilized/dp/B00114PN1U/ref=pd_bbs_1?
ie=UTF8&s=electronics&qid=1211821611&sr=8-1

This is the same url shortened using the takeme.to short url service:
http://takeme.to/HDCamcorder

Notice how short and memorable it is, but more so, notice the use of keywords in your url. This SEO-friendly url will now rank higher in search engines because of their inclusion.