A StringBuilder's main functionality is , as it's name implies, to build
strings. The fact is, in .Net, if you need to build a long string (using a
long loop for example) it would be much slower to accomplish by using
simple concatenation than it would be using a StringBuilder.
The speed improvement is very big. This is because internally, the
StringBuilder uses string pointers for concatenation, while a regular
concat operation actually creates a new string from each two concatenated
string, so if you do "a" + "b" you actually get 3 seperate string back,
a,c, and the result. in a loop doing this this is very slow.  A
StringBuilder does not create new string instances and so is much faster.
When to use: Whenever you have a non trivial string that you need to build
dynamically using a loop (when creating XML strings for example).

Roy Osherove
http://www.iserializable.com

StringBuilder is more efficient when you do string concatenating, especially
when you do that a lot vs. using += operator.

As the number of modification operations heads towards 10 and above,
StringBuilder becomes faster.  If the number of modifications is small (as
it is in your example), String will be faster.

Nick Wienholt, MVP
Maximizing .NET Performance
http://www.apress.com/book/bookDisplay.html?bID=217

Aside from the other answers you've received, sometimes depending on what
you're doing it's actually better to use a memory stream. In some cases
you'll get 50-200% speed improvements. But we're talking *large* strings =)