He's talking about nesting templates; Allowing one template to be used inside another template. He then goes on to explain how the context for the parent template can be passed to these child templates nested inside it.
Templates need variables passed to them in order to display dynamic information. These variables being passed, usually in an array or hash/dictionary, are often referred to as a "context". As Rick's article mentions, you're able to have a main context in your parent template, but also pass context to the child template.