The Ion Cannon is a defensive structure with a relatively high shield power. It fires a focused beam of ions capable of obliterating any unshielded electrical system and destabilizes the shield circuits within its target. These combined effects often cause the destruction of the targeted ship.
It can be useful to build as fodder when you have excess crystal, as it is the only defense which costs more crystal than metal. Another reason to build Ion Cannons is because only the Bomber and the Deathstar have Rapid-Fire against it. This makes them useful when defending against fleets of Cruisers and Destroyers that would rip apart your Rocket Launchers and Light Lasers.
Also note that the Ion Cannon can absorb up to 500 damage per round which is the second highest shield power next to the Deathstar. This makes it very useful against a Cruiser or Heavy Fighter fleet since most of the attacks will be deflected by the shields, while anything with Battleship strength will easily rip through the shields. Despite this Ion cannons are very useful defenses even in small numbers as they will draw and absorb a large amount of damage per round.
Note: For pros and cons of defensive structures, see Defense Comparison