"Windicators are indicators displayed in the window title bar that behave just like the indicators in the panel: they have an icon which shows state, and clicking on the icon brings up a menu," Shuttleworth explains, "Applications can create, update and remove window indicators using an API more or less like the AppIndicator framework first put to use in 10.04 LTS."
Basically, it would look something like this:
Shuttleworth gives several example windicators, such as a volume control windicator. Thanks to PulseAudio, Linux now has an audio stack with per-application volume controls. Using windicators, you could expose this functionality better: the volume control inside a window's titlebar controls the application-specific volume, whereas the menubar one controls the overall volume. Other examples include an indicator that tells you whether or not a file has been saved, an online/offline indicator, progress bars, or whatever else you can come up with.
While the idea is nice, I do have a number of concerns, the biggest of which is how this affects the large groups of users who change themes - myself included. The fancy new system tray in Ubuntu 10.04 only works with the default theme - if you switch to a different, supported icon theme (like GNOME Colors), the icons in the system tray misalign. Messed-up icons would look even worse in titlebars.
Then there's the issue of modifying the titlebar layout. I find the clustering of titlebar widgets quite silly, and wonder whoever came up with that quaint notion; in Windows and Mac OS X, I accidentally click the close widget all the time. In both GNOME and KDE, you can move the widgets at around as you please, which I do happily.
As you can see, I place the close widget on the right, the maximise widget on the left (for symmetry, I don't actually maximise anything), while minimise is handled by a double-click on the titlebar (for completeness' sake: right-click titlebar sends-to-back). The close widget is on the right for a very simple reason: menus and the like are left-aligned, so placing the close widget on the right is just asking for trouble.
I'm left wondering how Shuttleworth's windicators fit into this scenario.
All in all, I guess my concerns can be summed up in two simple points: first, can it be turned off, and two, will this implementation be more than skin deep?