Finally. Podcasts is a standalone podcast-listening app similar in concept to Instacast, only instead of 99 cents this one costs nothing. And being from Apple, it's officially the only podcatcher or music app on the App Store that can download content directly into the iPhone's music library, so your podcasts and subscriptions aren't just locked away in the app's data sandbox — everything syncs to and from iTunes.
On the other hand, Instacast has a lot of features I've grown accustomed to, and I agree with Dave's suggestion that third-party podcast apps might in fact get a boost as Apple's offering gets power users interested but wanting more. It's definitely worth checking Podcasts out if you're tired of relying on the Music app for all your listening needs.
Unrelated nitpick: Does it bother anyone else that Podcasts uses two similar, yet subtly different, tab UI styles? The new tab theme is more similar to how tabs look in iOS 6's iTunes and App Store apps, so it stands to reason the mismatch is due to this app launching first, and needing its podcast catalog UI to match how stores look on the current iOS. So it makes sense why they're different, but still, it's wrong.