Some water dispensers are free-standing units with large water reservoirs. Others are connected to your water supply. These generally have a filter installed to filter tap water.
Water dispensers may provide taps for hot and cold water. Simpler models only supply one or the other. Some have a third tap for room-temperature water.
Water dispensers come in varying capacities. Some are useful for a few people at home; others serve large numbers of people in an office. A dispenser connected to a water supply works at any capacity.
Water dispensers produce less waste than buying individual water bottles. They also can ease concerns about chemicals that may be in plastic water bottles or impurities that may be in tap water.
You'll have to buy filters for a dispenser that's connected to your water line or large containers of filtered water for a free-standing unit. Either option costs less over time than buying individual water bottles.