According to Webopedia.com, a blog (short for Weblog) is "a Web page that serves as a publicly-accessible personal journal for an individual. Typically updated daily, blogs often reflect the personality of the author".
The definition of blog is constantly evolving, though, as blogs move into the mainstream, shedding their image as the bastion of the self-obsessed who just have to self-express. Thousands of new blogs are being created every day, for all sorts of purposes. Rather than existing to catalog someone's personal life, many blogs serve as discussion communities about particular issues.
Nor does a blog have to have one author. Some of the most interesting blogs that I've read have multiple regular contributors. And some large corporations are using blogs internally as communications channels.
In light of how blogs are being used, I offer my own updated definition; a blog is a regularly updated online journal of information and opinions. What sets blogs apart from other online writing, IMHO, is their dynamic nature (as opposed to static Web pages) and their voice (style).
And these very qualities are what makes blogs such an incredibly useful tool for businesses.