I first thought this would let you simulate your arduino. This isn't the case, it's a sketch-only tool. From the faq: Does Fritzing simulate my circuit, like,

I first thought this would let you simulate your arduino. This isn't the case, it's a sketch-only tool. From the faq: Does Fritzing simulate my circuit, like, does an LED actually blink if I plug it in? No, sorry. We don't think that the advantage of having a simulation is worth the effort. Hardware is very difficult to simulate and it would also complicate the usage of Fritzing. Also, we think that it is important that you get hands on with the real stuff, and that you should try out your circuits physically. We will however add some simple checks in the future, to help you avoid common mistakes.