This is the first filter from the convolution filter family(nbsp)(ndash) Gauss smooth, Mean and Median. The convolution filters take a 3×3 matrix and apply it to the pixel neighbours. They can be applied on luma/chroma or both.
When they're applied on chroma only, they are very efficient to get rid of chroma noise from analog TV or VCR capture. For even more effective chroma smoothing, see the Median (5x5) filter.
Typical chroma effects on analog video may look like this:
Applying some convolution-based filters on chroma reduces the artifacts:
The good thing about blurring chrominance is that it does not affect the perceived picture sharpness and structure too much, as that's mainly determined by the luminance part.