An extension is an application which is used to add extra functionality to the the main application. So wave extensions are mini-applications that works within a wave.
Two types extensions are available in Google Wave - Gadgets & Robots.
Robots
A robot is an automated participant on a wave. They can talk with users and interact with waves. For example "bitly-bot@appspot.com" is a robot which automatically convert a long url to short bitly url. So if you send a long url to a wave and if the bitly robot is present, it will take that long url and generate a short url and when you press done – you and others will see only the short url.
Now a robot can perform actions such as the following:
- modify information in a wave
- interact with participants in a wave
- communicate and synchronize information in a wave to the outside world or to other waves
- access or modify state in a third-party (such as a database)
So How can I add a Robot?
Very simple. Just add them as a contact, then add the robot-contact to a wave.
Testing
Sometimes two robots might not work in the same wave. For example i tried to use both flippy and hangman in the same wave. But to play hangman, i have to send “play hangman”. But flippy flips that text to “uɐɯƃuɐɥ ʎɐlԀ” so the hangman will not detect “play hangman” text. So I have to remove flippy. Or you have to change the order of those robots so hangman robot will be called first and then flippy.
Gadgets
Gadget extensions provide a shared program which runs within the wave, and to which all participants have access. A good comparison would be iGoogle gadgets or Facebook applications.
How to use a Gadget?
To add a Gadget to a wave- J st click on the green puzzle piece, and enter the url into the bottom text box.
I added Vector Editor Gadget to my wave
Google wave Extensions List: http://docs.google.com/Doc?docid=0AdY6WUNA7GnbZGZ0aGhqeDNfMGNmNndwcWhn&pli=1 .
Google wave is not much interesting without these extensions. You can create your own extensions and submit to wave, just like iGoogle gadgets or Facebook applications.

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