This allows people to open documents read only when they don't want to edit.
So it would be possible to open a document to edit which is already open by other users in read-only mode.
This is very useful for team work when the document is stored on a network folder.
Excel has this feature.
I think this should be identical for all Office Products, or even better for all Windows Software.
Thomas
P.S.
I know the feature: Shift + right click -> open read only
But this is not a replacement as this requires action of the user.