They enable water to be pumped in a network that runs between the horizontal layers of a stack and the thousands of vertical interconnections that carry information between its layers.
He explained to me that his central realization was that he had to control the relationships between the different layers of the application stack in order to make sure that it could reliably deliver smooth movement.
There's also been talk of Apple using a thinner, better panel that would likely use in-cell touch rather than stack the LCD and touch surfaces in separate layers.