It's a tag similar to `<content>`, but which comes into play when you have a pseudo-class hierarchy of custom elements, like we have here (notice how spark-menu extends spark-selector). With `<content>` and not `<shadow>` in spark-menu, the "older" shadowRoot of spark-selector, essentially defined by the its `<content>`, would be replaced by the "younger" one defined by the `<content>` in spark-menu. So the spark-selector's shadowRoot wouldn't render. `<shadow>` fixes that. See an example here:

http://www.html5rocks.com/en/tutorials/webcomponents/shadowdom-301/