Without going too in-depth, they allow teams to set up accounts on a central website, where team members can contribute to that central git repository. There are also other project-management features baked into the tool (code review, issue tracking, etc).
Of course, this can all be done using a bare git server running on some publicly-available computer, but they offer nice UIs and very friendly onboarding so that makes them attractive for teams.
I would amend that to "source-code collaboration applications". The hosting is not the important part.