This means a timeline that contains various media with multiple tracks and clips with cuts, can be exported, for example, from Kdenlive and imported into DaVinci Resolve. This is useful where often one editor can do things that another editor cannot do.
You can read more about the OpenTimelineIO, or OTIO, standard at https://opentimelineio.readthedocs.io/en/latest/index.html. Their site does state: OTIO supports clips, timing, tracks, transitions, markers, metadata, etc. but not embedded video or audio. Video and audio media are referenced externally.
I picked up on this from Kdenlive’s post on Mastodon, about how they have achieved exporting a timeline from Kdenlive and importing it into DaVinci Resolve. The attached image shows this announcement, which can also be seen at https://mastodon.social/deck/@[email protected]/113622947347734481.
Despite this though there may still be some challenges, for example with DaVinci Resolve on Linux not supporting AAC audio, so no audio editing will be possible then on the DaVinci side (without conversion). Although I’d expect the audio could be left intact as AAC if it is just re-imported back to Kdenlive.
On DaVinci Resolve’s side, I see they announced support for OTIO was added already from their version 18.5.