At a simple level, extraction is the process of dissolving the solubles in ground coffee, in water.
Extraction is the universal process of preparing coffee based drinks, be it instant coffee (which is simply vacuum dried brewed coffee) or freshly brewed beverages like filter coffee, French press or espresso/espresso based beverages like cappuccino, latte etc.
We target about 20% of solubles in Coffee grinds, to be in our cup of beverage for a pleasant tasting cup. Temperature of water, coffer grind particle size and time allowed for coffee grinds to interact with water determine the final taste of the cup of brewed coffee.