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A major issue in collaborative authoring is keeping track of who wrote what. Note that applies to new text, modified text, and deleted text. In a document possibly edited in multiple places by multiple authors, you need to be able to track changes for each edit - who did it, and when. You also may want to protect a document against unauthorized changes, by which I mean you allow people to edit it, but their changes have to be marked as revisions, they can’t really change the document.
Revision marking solves this problem by making edits provisional. That is, when you delete a sentence with revision tracking on, we don’t really delete it; we mark it as deleted by you, on this date, at this time. Note that this means of marking text means that storage is independent of display or print; for instance, you could view the document with all revisions marked, or you could view the document as if all the revisions had really happened as edits. In principle you could slice the document’s edit history in many ways. We further include a deferrable review process. A reviewer - or, if the document is protected, an authorized reviewer - can walk through the revisions in the document and for each decide to accept it, reject it, or skip it and come back later.
A consideration for the Web is that these edits have to be stored somewhere. In a typical Word document opened over a LAN, the marginal file size increase isn’t too bad, and the benefits of storing everything in the one portable file clearly outweigh the speed hit. Over a 28.8 modem, it’s a different issue entirely.