This is a bottle of Wine (or Not Wine, i.e. sparkling fruit juice.) It's used in celebrations to toast the Gods, to pour libations, and to show the fruitfulness of the Earth. It also shows the joy that comes to each of us in this life.
Although wine is recommended if the group is using a communal cup (to keep down the germs,) there are plenty of folks that cannot use it for one reason or another. For a celebration with these folks, it's perfectly acceptable to use Not Wine, although I would recommend separate cups for everyone if you do.
Traditionally, there shouldn't be any wine left in the communal cup after the blessing, so the HPS (High Priestess) drinks it. If this is impractical for one reason or another, it's perfectly acceptable to empty the rest into the libation bowl.