I read about this on FlyerTalk. I didn't try to understand the article. But the 199 Euros includes taxes and fees. It's meant to be a competitor for a rail pass. TUIFly goes to numerous destinations to/from various German cities.
You can book a pass (199 euro, taxes at fee, are included in the price) between 14th and 31th of August. For this pass you have to be 27 or younger. If you have this pass, you can choose around 40 destinations around the world, and you fly for free for 6 weeks. (although most destinations are cities within Europe, like Rome, Naples, Paris etc) The pass can be used between half august and 31th of october.
The trick is that the seats for these flights can be booked only 2 days before the flights. (You can see on the website a week before the flight, if there will be seats available). They forsee, that at each flight there willl be 3-4 seats available.
The articles also mentions that TUIfly is having deals on their website, including selling tickets for 5 euro (without taxes/fee).