Could someone please explain what is going on in this demo?
It's a new major version of HTTP. At the high level it's backwards compatible (status codes, urls, etc are the same), but the communication of those things changed. It's binary instead of plain text (a major point of contention), it's stateful instead of stateless (it can refer back to previous requests, which makes debugging harder when you jump in the middle of a communication), it can multiplex data (send multiple files concurrently--this is where the demo shines), adds a prioritization layer, and header compression. I may have some of those details wrong--all of that I learned from the talk.