An Apple ID is the login you use for just about everything you do with Apple, including using iCloud to store your content, downloading apps from the App Store, and buying songs, movies, and TV shows from the iTunes Store.
You need only one Apple ID for everything you do with Apple. If you have an Apple ID, use it when you first set up iPhone, and whenever you need to sign in to use an Apple service. If you don't already have an Apple ID, you can create one when you're asked to sign in.
Create an Apple ID. Go to Settings > iTunes & App Stores and tap Sign In. (If you're already signed in and want to create another Apple ID, first tap your Apple ID, then tap Sign Out.)
For more information, see appleid.apple.com.