“Spell damage is an attribute granted by buffs, talents, and equipment that increases the effect of spells.” (wowwiki.com)
The more spell damage a character has, the more damage that character's spells do.
Items in WoW have either +spell damage, + spell damage and healing, or spell damage related to just a particular school of magic, for example +shadow damage. Any bonus to a particular school of magic, only applies to that kind of spell.
Sometimes you will see the statement
“Increases damage and healing done by spells and effects by up to...”
The ambiguity in how much spell damage is actually applied depends on the spell you're casting, and its duration and cast time. The amount of spell damage applied to a certain spell is its 'coefficient.'
The common rules for spell damage coefficients are as follows:
notes: all cast times should be calculated before talents. Instant cast spells are treated as having a 1.5 second cast time.
Standard Direct Damage Spells (all of the damage is applied in one hit, like a Shadow Bolt)
((Cast time of spell)/3.5)
-spells with a cast time of more than 7 seconds are capped at a 200% coefficient
-an exception is Soul Fire at 115%
Over Time Spells (the damage is applied over a fixed amount of time)
((Duration of Spell)/15)
-exceptions are Corruption 93%, and can be increased to 129% through the Affliction talent Empowered Corruption; Curse of Agony 120%, and Curse of Doom 200%
Combined Direct Damage and Over Time Spells (a spell such as Immolate, applies direct damage on the initial hit, then damage over time)
For the over time portion (Duration / 15) / ((Duration / 15) + (Cast Time of Spell / 3.5))
For the direct damage portion (1 - Portion to Over Time)
After those calculations, you need to add the time parameters.
For the direct damage ((Cast Time of Spell / 3.5) * Portion to Standard)
Over time ((Duration / 15) * Portion to Over Time)
Channeled Spells (Hellfire, Drain Life, Drain Mana, Drain Soul)
(Cast Time of Spell / 3.5)
Area of Effect Spells (the damage is applied in a certain area such as Rain of Fire)
((Cast Time of Spell / 3.5) / 3)
Coefficients of some common warlock spells (cause who likes to do math? =P)
(more info can be found at Spell damage coefficient - WoWWiki - Your guide to the World of Warcraft)
Corruption-93.6%, can be increased to 129% with Empowered Corruption
Unstable Affliction-110%
Siphon Life-100%
Curse of Agony-120%
Immolate- 35% to initial hit, 65% to damage over time portion
Shadow Bolt- 85.71%
Shadow Burn- 42.86%
Soul Fire- 115%
Incinerate- 71.43%
Conflagrate- 42.86%
So...what does this all mean? It's easy, to find out how much of your +spell damage will contribute to a certain spell, just multiply the percentage coefficient by the amount of spell damage.
Example: Unstable Affliction (base damage of 1050), with 1000 spell damage = (1.10 *1000)=1100
so, you would add 1100 to the total damage of the spell, making that spell hit for a total of 2050.
In summary, spell damage is just one of the many, many ways to improve your character in World of Warcraft. For most dps casters, it is considered
themost important stat, we're damage dealers at heart, and increasing your spell damage will generally increase your damage output. There are many other important stats to keep in mind such as spell hit, spell penetration, stamina, intellect....the list goes on; however, we cast spells, and generally spell damage is the stat for us.
~Information taken from wowwiki.com, and tweaked to my standards =P