• Provides security software vendors a more secure way to communicate with Windows Security Center.
• Includes application programming interfaces (APIs) by which third-party security and malicious software detection applications can work with kernel patch protection on x64 versions of Windows Vista. These APIs help ISVs develop software that extends the functionality of the Windows kernel on x64 computers without disabling or weakening the protection offered by kernel patch protection.
• Improves the security of running RemoteApp programs and desktops by allowing Remote Desktop Protocol (RDP) files to be signed. Customers can differentiate user experiences based on publisher identity.
• Adds an Elliptical Curve Cryptography (ECC) pseudo-random number generator (PRNG) to the list of available PRNGs in Windows Vista.
• Enhances BitLocker Drive Encryption (BDE) to offer an additional multifactor authentication method that combines a key protected by the Trusted Platform Module (TPM) with a Startup key stored on a USB storage device and a user-generated personal identification number (PIN).

Reliability Fixes

• Improved reliability and compatibility of Windows Vista when used with newer graphics cards in several specific scenarios and configurations.
  
• Improved reliability when working with external displays on a laptop.
  
• Improved Windows Vista reliability in networking configuration scenarios.
  
• Improved reliability of systems that were upgraded from Windows XP to Windows Vista.
  
• Increased compatibility with many printer drivers.
  
• Increased reliability and performance of Windows Vista when entering sleep and resuming from sleep.

Performance Improvements

• Improves the speed of copying and extracting files.
  
• Improves the time to become active from Hibernate and Resume modes.
  
• Improves the performance of domain-joined PCs when operating off the domain; in the current release version of Windows Vista, users would experience long delays when opening the File dialog box.
  
• Improves performance of Windows Internet Explorer 7 in Windows Vista, reducing CPU utilization and speeding JavaScript parsing.
  
• Improves battery life by reducing CPU utilization by not redrawing the screen as frequently, on certain computers.
  
• Improves the logon experience by removing the occasional 10-second delay between pressing CTRL-ALT-DEL and the password prompt displaying.
  
• Addresses an issue in the current version of Windows Vista that makes browsing network file shares consume significant bandwidth and not perform as fast as expected.

• BitLocker Drive Encryption encrypts extra local volumes. For example, instead of encrypting only drive C, customers can also encrypt drive D, E, and so on.
  
• Addresses problems with printing to local printers from a Windows Terminal Services session.
  
• The Network Diagnostics tool will help customers solve the most common file sharing problems, in addition to the basic problems that it already diagnoses.
  
• Administrators can control the volumes on which to run Disk Defragmenter.
  
• The service pack will uninstall the Group Policy Management Console (GPMC) and GPEdit.msc will edit local Group Policy by default. In the SP1 timeframe, administrators can download an out-of-band release that will give them the ability to add comments to Group Policy Objects (GPOs) or individual settings and search for specific settings.

Support for Emerging Hardware and Standards

• In the future, flash memory storage and consumer devices will use the exFAT file system. Windows Vista SP1 adds support for this file system to Windows Vista.
  
• The service pack will include support for Secure Digital (SD) Advanced Direct Memory Access (DMA), which will be on compliant SD host controllers soon, to improve transfer performance and decrease CPU utilization.
  
• x64 PCs can boot using the EFI. Windows Vista currently supports network boot by using Windows Deployment Services for x86, a PC's basic input/output system (BIOS) for x64 PCs, and EFI for IA-64 PCs. Windows Vista SP1 will add support for network boot by using x64 EFI.
  
• The service pack will add support for Direct3D 10.1, adding application programming interfaces (APIs) and features that enable 3-D applications, so game developers can better take advantage of a new generation of Direct3D graphics hardware.
  
• The Secure Socket Tunneling Protocol (SSTP) is a remote access tunneling protocol that will be part of the Routing and Remote Access Service (RRAS) platform. This protocol helps provide full-network virtual private network (VPN) remote access connections without challenges that other protocols face when traversing NATs, Web proxies, and firewalls. Windows Vista SP1 will include support for SSTP.

Miscellaneous Improvements

• Adds support for Direct3DŽ 10.1, an update to Direct3D 10 that extends the API to support new hardware features, enabling 3D application and game developers to make more complete and efficient use of the upcoming generations of graphics hardware.
  
• Addresses issues many of the most common causes of crashes and hangs in Windows Vista, as reported by Windows Error Reporting. These include issues relating to Windows Calendar, Windows Media Player, and a number of drivers included with Windows Vista.
  
• An improved SRT (Startup Repair Tool), which is part of the Windows Recovery environment (WinRE), can now fix PCs unbootable due to certain missing OS files.
  
• Adds full support for the latest IEEE draft of 802.11n wireless networking.
  
• Improves OS deployment by enabling 64-bit versions of Windows Vista to be installed from a 32-bit OS. This will allow IT professionals to maintain just a single WinPE image.
  
• Improves patch deployment by retrying failed updates in cases where multiple updates are pending and the failure of one update causes other updates to fail as well.
  
• Enables reliable OS installation by optimizing OS installers so that they are run only when required during patch installation. Fewer installers operating results in fewer points of potential failure during installation, which leads to more robust and reliable installation.
  
• Improves overall install time for updates by optimizing the query for installed OS updates.
  
• Improved instrumentation allows additional data to be sent to Microsoft via the CEIP (Customer Experience Improvement Program) when enabled. This telemetry data led to the identification of numerous issues that are addressed in SP1 and resulted in improvement in the reliability of OS servicing.
  
• SP1 reduces the number of UAC (User Account Control) prompts from 4 to 1 when creating or renaming a folder at a protected location.
  
• Improvements in the Licensing User Interface and User Experience including more details in the help about activation and what happens if user does not activate; more detailed and descriptive dialog text; raw error codes replaced with easily comprehensible text.
  
• While not reflected in the initial release candidate this week, we will also be making changes effective with SP1 in how we differentiate the experience customers have using non-genuine versions of our software. This is based on feedback we heard from volume license customers in particular as part of our Windows Genuine Advantage program.
  
• Improves the performance of browsing network file shares by consuming less bandwidth.
  
• Improves power consumption and battery life by addressing an issue that causes a hard disk to continue spinning when it should spin down, in certain circumstances.
  
• Improves the speed of adding and extracting files to and from a compressed (zipped) folder.
  
• Significantly improves the speed of moving a directory with many files underneath.
  
• Improves performance while copying files using BITS (Background Intelligent Transfer Service).
  
• Improves performance over Windows Vista's current performance across the following scenarios1:
• 25% faster when copying files locally on the same disk on the same machine
• 45% faster when copying files from a remote non-Windows Vista system to a  SP1 system
• 50% faster when copying files from a remote SP1 system to a local SP1 system
• Improves the time to read large images by approximately 50%.
• Improves IE performance on certain Jscript intensive websites, bringing performance in line with previous IE releases.
• Improves responsiveness when doing many kinds of file or media manipulations. For example, with Windows Vista today, copying files after deleting a different set of files can make the copy operation take longer than needed. In SP1, the file copy time is the same as if no files were initially deleted.
  
• Addresses a problem that caused a delay of up to 5 minutes after boot with specific ReadyDrive capable hard drives.
  
• Improves the effectiveness of a Windows ReadyBoost™ device in reducing the time to resume from standby and hibernate by increasing the amount of data stored in the ReadyBoost device that can be used during a resume cycle.
  
• Includes improvements to Windows Superfetch™ that help to further improve resume times, in many environments.
  
• In specific scenarios, SP1 reduces the shutdown time by a few seconds by improving the Windows Vista utility designed to sync a mobile device.
  
• Improves the time to resume from standby for a certain class of USB Hubs by approximately 18%.
  
• Improves network connection scenarios by updating the logic that auto selects which network interface to use (e.g., should a laptop use wireless or wired networking when both are available).
  
• Reduces the time it takes to return to the user's session when using the Photo screensaver, making it comparable to other screensavers.
  
• Removes the delay that sometimes occurs when a user unlocks their PC.
  
• Improves overall media performance by reducing many glitches.
  
• Windows Vista SP1 includes a new compression algorithm for the RDP (Remote Desktop Protocol) that helps reduce network bandwidth required to send bitmaps or images via RDP. The compression, which can be selected by administrators via Group Policy settings, is transparent to all RDP traffic, and typically reduces the size of the RDP stream by as much as 25-60%, based on preliminary test results.

Sources:
http://download.microsoft.com/download/9/0/d/90da9663-815a-4ce8-88c0-2b9f54c69efe/Windows%20Vista%20Service%20Pack%201%20Beta%20Overview.pdf 

http://download.microsoft.com/download/f/4/a/f4a35b2b-2f62-4104-a3e6-5f7bc1318e9f/Notable%20changes%20in%20Windows%20Vista%20SP1.pdf