its a shader that goes on a specialized terrain actor in an editor. that's it. depending on the editor, sometimes it can mix together textures by a weight mask that you can paint in an editor, or is generated by height or slope algorithmically. Sometimes it can use complex materials, incorporating them into it's under-the-hood shaders. Sometimes it will capitalize on a normal map generated from a higher tesselation terrain, for making the lower tesselation terrain look more detailed. Oftentimes terrain shaders are tightly integrated to the editor in question due to unique tiling, tessellation, layering, and weightmasking setups
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something like this:
http://www.laurenscorijn.com/vertex-blending-snow.html