Who Is Hatsune Miku?

So as we all know by now, Hatsune Miku is the next singer for Festival. Whilst I am definitely excited (actually the most excited I have been for a new Festival season in a while), I don't understand who or what Hatsune Miku is. All I know is that it isn't a real person, or at least I am fairly certain it isn't. Is it some sort of AI that can make songs.

I ain't trying to sound stupid. I just genuinely don't know who Hatsune Miku is. Anyone able to explain to me who this girl is?