A voice synthesizing program lets you type in words and make the program say it back to you. Vocaloids are programs that does this but also allows users to map the words to musical notes, and manipulate phonemes, add bravadoes, etc so the voice played back sounds like singing. Combined with instrumental tracks any artist can essentially compose any song they want and get the computer to sing it without the help of a vocalist.
Some people think the computer generated voices sound so real they made albums with it, and for promotional purposes went on to personify these voices as fictional characters, creating conceptual designs, character backgrounds, etc. Then companies like SEGA created 3D renditions of these artificial singers, and animated them. When these animations are projected on a special piece of glass in a dark room, it creates the illusion of the character in real space, without 3D glasses.
For concert organizers this is more efficient than hiring real singers and dancers on stage, and dealing with human error. Since all the animation is previously generated, and the singer will never lose her voice or get tired, you have a lot more control over the concert. But we also have to consider the extra cost of animating, rendering and R&D.; Unlike Lady Gaga or Justin Bieber, vocaloid celebrities only exist in the imaginations of their creators and fans because they are artificial in every way, even their voices, but the crowd’s reaction would have you think otherwise. The gap between fantasy and reality is growing thinner.