Disclaimer: I have no idea how UDIM's work in WM.
But, I can tell you what UDIM's do in a VFX CGI pipeline. UDIM's are a way of splitting a single mesh up into multiple UV tiles. Imagine you had a CG character. You could have a single mesh for the entire character, but a separate UV tile for the hands, face, and body for example. The face might be in UV space of U0-U1 (V0). The body could be in U1-U2 (V0). The hands could be in U2-U3 (V0). In these cases the "UDIM" is just a number that tells the rendering program which map to use for which tile. The UDIM numbers for these three tiles would be 1001, 1002, 1003*.
So, in our example above, we would have the following maps:
diffuse.1001.tif
diffuse.1002.tif
diffuse.1003.tif
Each one of these would have the texture maps for that particular UDIM (face, body, hands) painted as though it were in 0-1 UV space. But when you apply these maps in the renderer, you only have to tell it that the character's diffuse maps are (for example):
diffuse.<UDIM>.tif
instead of selecting each sub-patch (face, body, hands) and loading a specific map for that particular object.
The renderer will then get to a patch on the character, look up where the UV's are, find out that they are (for example) in UDIM 1002, and then load the color information from that map (diffuse.1002.tif).
To understand the utility of this, imagine a single mesh with over 100 UDIM's on it. Instead of selecting each and every sub-patch and the applying one map for each channel (i.e. diffuse, spec, reflection, roughness, bump, displacement, normals) - which would mean you have to apply by hand over 700 maps - you can simply point each channel to a single "map" using the "<UDIM>" notation and have the renderer automatically load the correct map for the correct patch for you. In other words, you just have to do seven assignments and everything just auto-applies at render time.
Ultimately this is similar to just about any other tiled UV system (face-sets, u#-v#, etc.) that is out there. It is just that this particular notation has gained the most traction (mostly because of the Foundry's Mari application which, I think, first introduced it).
So, if you are rendering with a renderer that understands UDIM's, you could output hundreds of tiles from WM and have them automatically place themselves in the correct location on a mesh that has been similarly divided up in UV space.
TL;DR
It is a way of automatically applying tiled images to a single mesh that contains tiled UV ranges.
* (UDIM numbers are not super logical at first glance. They basically are numbered from the bottom left and go: 1001, 1002 ... 1010, 1011, 1012...1020, 1021, 1022 ... etc. They start at 1001 and go up to 10 tiles to the right, then move up from there).
