What it means is that if you do an 'init S', thus going down to single-user mode, AND IF you were logged into a serially connected terminal (or maybe modem) that the terminal you are logged into would BECOME the console.
I do not know, though I doubt, that this applies to a telnet session. Networking gets stopped between runlevels 2 and 1, I think, so your telnet would be disconnected.
BASICALLY, in this world of few hardwired terminals and many network connections, the two are the same.