PIM-SM, or Protocol Independent Multicast - Sparse Mode, is a routing protocol used to efficiently manage the distribution of multicast traffic in a network. It allows routers to communicate and share information about multicast group memberships, enabling data to be sent only to those devices that have expressed interest in receiving it. This is particularly useful in scenarios where multicast traffic is sporadic and not all devices need the data at all times. In PIM-SM, routers use a shared tree structure to route multicast traffic, starting from a designated rendezvous point (RP). When a device wants to join a multicast group, it sends a request to the RP, which then helps establish the necessary paths for data delivery. This method conserves bandwidth and reduces unnecessary data transmission, making it ideal for applications like video streaming and online gaming.