This is a practical example of multiplexing.
Multiplexing is used when you need to control lot of leds but you only have one controller so you use multiplexing.
This can be done by turning on only one display at a time and feeding it with it's number but in real life this works so fast that you see all the displays displaying their numbers like 0123 but you don't see them turning on and off for a thing called persistence of vision.
I know the description is kind of a bad explanation but i'm bad at explaining and i'm italian :P
-nikisalli