Apple released iOS 5 Beta 4 on Friday afternoon, which was actually available as an over-the-air update for the first time ever from Apple, provided your device is running iOS 5 Beta 3. The OTA update works on both Wi-Fi and 3G connections. Apparently when the update was first released yesterday, there were some initial problems with the over-the-air update process, but MacRumors reports that all those problems now seem to have been smoothed out, with the added bonus that updating over-the-air saves nearly 700MB of downloading when compared to the normal full download. However, according to MacRumors, when using the over-the-air update, just to be on the safe side you should be sure to have at least 50% battery life left for the iPhone, and 12% battery life left for the iPad, or have your device plugged into a charger or computer. Note that OTA updating doesn’t work on jailbroken devices. It’s also been discovered that when an OTA update is available, you’ll see a red, numbered icon in the top right corner of the “Settings” icon, just as you do on app icons when an update is available.
One other small change revealed in the latest Beta is the addition of a “Documents and Data” toggle switch in the iCloud settings, which enables you to choose whether or not you want apps to save documents and data to the iCloud. You can also select whether or not you want these updates to the iCloud to be Wi-Fi only.
Source: Apple Seeds iOS 5 Beta 4 to Developers, Over-The-Air Updating Going Live - Mac Rumors
iOS 5 Over-the-Air Update Video, Documents on iCloud, and Other Notes - Mac Rumors