Columbia Business School certainly deserves its reputation as one of the best business schools in the world and by all measures offers an excellent business education. As with all b-schools, though, understanding the particulars of Columbia's strengths and weaknesses helps make better decisions about attending the school or hiring alumni. As a graduate (class of '99), I'll try to give an informed view.
Columbia's charismatic Dean Meyer Feldberg sells potential students on the 'New York Experience', in effect putting the location ahead of the education. As compared to other business schools, Columbia offers its students a much richer set of opportunities while in school due to its proximity to the financial and media capital of the world (not to mention fashion, advertising, etc). The students who get the most out of CBS are those who leave campus the most. This extends beyond garden-variety internships available at other top-tier schools, to real daily involvement in the business of this city. As a second-year it is not uncommon to have social/business plans every day and every night of the week.
The school's weakness is its domination by finance and consulting, in terms of course work, student recruitment and career options. Not that there's anything wrong with that, but it's a clear bias. The marketing and operations courses are truly third-rate. The job opportunities in technology and media are getting better, but its up to the students to really seek them out.
The administration knows about these issues and is very upfront about its ambitions, goals, and weaknesses. Applications and related metrics are up every year, so they must be doing something right.