It is generally understood to be content that takes the same form and qualities of a publisher’s original content.
It usually serves useful or entertaining information as a way of favorably influencing the perception of the sponsor brand.
The definition of ‘sponsored content’ – American Press Institute
In the past, when advertisers, “Brands,” and publishers put out this kind of sponsored content, it had visible or audible markers to alert the reader that it was in fact, advertising. This push to native advertising seems like a justification for blurring the distinction between the kinds of content.