This is a card/point system to purchase files on the online network provided by Microsoft, you can purchase anything with these points like arcade games, games on demand, add ons for games, themes, trailer, movies and many more. You can even change your gamertag using these points.
This is a handy little pack of Xbox live points that you can use to purchase games or upgrades to your games. It won't get you much though because most games start at 800 points now and some are over 1000 points. However, it is a great way to give the points as a gift to someone and it is really easy to use.