Most people take it for arthritis, to rebuild tissues/cartilage. There isn't any formal proof that it works, unfortunately, and this is one area where Western medicine actually looks at closely in order to find pharmeceutical solutions, since Arthritis
is such a big money maker.
If the collagen is derived from cow sources raises worry about mad cow disease. The protein/fat makes a lot of work for the liver, whcih is usually part of the cause of degeneration to begin with.
The collagan gives the body peptides - protein chains - that the body manufactures itself. There's no evidence that supplementing with extra protein in this way forces the body to make more of a particular peptide or utilize it where the injuries are.
I have an ankle that likes to annoy me, and tried amino acids, glucosamine, etc., didn't see much improvement. Sports people and martial arts people, people who strain/overuse their joints, however, say they do see improvement. So someone taking it ought to do their own experiments - try and see, if no improvement, stop and see if things worsen.
Hope that answers your question!