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.
Also, just above the digital audio connections are the RS-232 and RI wired remote control connections. These connections are used in custom installation setups for integrated system control. In addition, the RI wired remote connection is where you would connect the RI cable on the optional iPod dock to access iPod control functions using a wireless remote control.