While it’s possible to hold video calls with multiple participants using peer-to-peer communication, it stops being practical as the number of participants increases. This is because a peer must send their video/audio stream to every participant while also receiving a video/audio stream per participant.
In practice, even under optimal network conditions, a mesh video call doesn’t work well beyond five participants. This is where a media server comes in handy as it helps reduce the number of streams a client needs to send, usually to one, and can even reduce the number of streams a client needs to receive, depending on the media server’s capabilities.
When a media server acts as this kind of media relay, it is usually called a single forwarding unit (SFU). Its main purpose is to forward media streams between clients.
There’s also the multipoint conferencing unit (MCU), which is used to address a media server that not only forwards but can operate on the media streams that go through it. An example of this is mixing all video or audio streams into a single one.
For further read: https://bloggeek.me/media-server-for-webrtc-broadcast/