The term was used correctly. The idea is to use Threads as a way to capture people who wanted to onboard to Mastodon and those who wanted an alternate to Twitter.
Over time, Threads could demand that Meta's app be used to access Threads, allowing Meta to control the algorithm. It could also start strategically defederating from other instances over time.
After a while, Meta would likely only allow government and major companies' official accounts to federate with it. Meanwhile, Meta would control the customer base.
Had an interesting conversation with a Syrian when flying from Kuwait to Jordan. I didn't know Arabic; he didn't know English. We used Google Translate to talk.