WebM is an open video encoding standard by Google. It consists of video streams compressed with the VP8 or VP9 video codec, audio streams compressed with the Vorbis or Opus audio codecs, and WebVTT text tracks. It may contain alpha planes for transparency.
For the purposes of the video tag introduced by HTML5, there was a need for an open (royalty-free) video codec which could be incorporated into free open source projects. WebM is Google's answer to this challange. An other possibility is Theora (also royalty-free).
Other vendors are voting for H.264 (mostly Apple and Microsoft), for which they already bought the licenses to incorporate into their web browsers.