COM is a part of the PHP core (formerly a PHP extension before PHP5) for Windows, to allow working with external programs. Since you're getting the "not defined" error then you're either not on Windows or are using PHP4 without the COM extension installed. Using the COM, as in the example code that you posted, allows PHP to actually talk to Word itself, directly, rather than just manipulating the doc file in PHP.

Edit: Here's a link to the COM Documentation in the PHP manual.