It is one of the two post editor views currently included in WordPress. The other one is the visual editor. The visual editor is of the What You See Is What You Get (WYSIWYG) variety, which means that it shows you a preview of the formatting of the content and the media embedded in it. You can switch between the two different editors by clicking the tabs in top right corner of the editing view.
The benefit of the text editor is that you can see exactly what goes into the content of your posts. It gives you more control over the positioning of each embed, the number of line breaks between each paragraph of text, and so on. The downside is that the text editor displays the content of your posts in HTML code, which is less intuitive than seeing a preview of how the content will look when it’s displayed on the site.