According to <A href="http://www.itwire.com/content/view/21078/1168/">iTWire</A>, you simply choose a gender and a starting letter, then give the iPhone a shake at which point your iPhone will make a sound like a baby's rattle and throw up a scrollable list of baby names, complete with origins and descriptions (although maybe "throwup" isn't a good choice of words when talking about babies). If you don't like any of those, give it another shake and it will throw up more choices.
What will they think of next?