"what is coming out actually?" In my opinion, it means being open (at least to 'close' people) about your sexual preferences. It is mostly about feeling free in trusted settings. For example: At my parents home, a trusted place, I really want to be able to take my boyfriend with me. On the other hand, on my study, very few people know about me having a boyfriend. But, I don't care because it is not really relevant anyway in that setting. So a coming out restricts (in my opinion) to people that you care about (and care about you).
"Is coming out necessary at all?" Abstractly, the answer should be: no; in a perfect world, people don't care about one's sexual preference. Unfortunately, heteronormativity is really strong in the real world, implying that most people around you expect you to be straight and sometimes even want you to be straight. This results in not feeling free to express homosexual feelings, what most people experience when they are still in the closet.
Also, socially, the answer is: no. If one can cope with less freedom around loved ones (family, friends), and seperate this part of one's life completely from the 'homosexual part' (for a undefinite time), a coming out is not necessary. However, most people cannot endure this, and chose either for a coming out, either for a full seperation from family and the old friends.