These connections are used to access Dolby Digital or DTS surround sound from DVD players, Digital Cable Boxes, Satellite Boxes, or other source component that has either a Digital Optical or Digital Coaxial output connection. Some devices have both options, in which case, you can can choose either.
It is also important to note that some CD-Only players have digital audio outputs as well, however, these are just two channel outputs.
You will also notice that there is one Digital Optical Audio Output and one Digital Coaxial Audio Output. This allows a digital audio connection between the receiver to a CD Recorder or other recording device that has Digital Optical Inputs.
Also pictured are the iPod ("The Bridge") and XM Satellite Radio Connections. The Bridge connection allows an iPod to be connnected to the receiver using a special dock called "The Bridge" , and the XM Radio Connection allows the connection of an XM Tuner/Antenna (paid subscription required for program access).