It basically replaces ASMX, but can also be used for other types of messaging. For example, it also replaces .NET Remoting (which replaced COM+, which replaced DCOM) and it can also be used for queuing.

>I'm not really the one to ask :-{ but my understanding is that WCF just provides a general architecture for message transfer. If might use web services (or remoting, message queues or whatever) so, as such, if doesn't replace web services - just sits on top of them.