spumux is a way to multiplex or add subtitles/subpictures to an MPEG stream. It is also used to make DVD menus, which are technically just fancy subtitles.

  spumux example.xml < example.mpg > example-with-subtitles.mpg

That is the command to add subtitles based on example.xml, an XML control file, to the stream example.mpg, which results in the new stream example-with-subtitles.mpg.

"MPEG stream" is just a fancy term for "MPEG file".

Here's an example spumux control file. It's pretty basic:

<subpictures>

  <stream>
      <spu start="00:00:00.00"
       end="1:30"
       highlight="./hi.png"
       select="./sel.png"
       autooutline="infer"
       outlinewidth="2"
       />
  </stream>

</subpictures>