According to our media what it means is the US govt can by pass rule of law and the courts and simply ask the Brits to read your E mail etc without a court order and pass the info back to the US, thus negating your Constitutional laws.
The 'Five Eyes' have been around since WWII. Nothin new, except with time and technology expanding so have they, especially with the web. Wouldn't surprise me if the Smartphone was included with this too.