It is basically. Some people use a green screen others a blue. You just key out the green background in an image editor like Photoshop and put in whatever you want. It's much easier I think than having 20 background screens you have to lug out and change out all the time. You do have to be careful about how you light it because you can end up with hot spots that make it difficult to key but I don't find keying out the green screen all that difficult actually. Mostly I've used it so far with grunge paper backdrops. I like that look behind portraits. (See example below.)
But I've also done the train pic with the little boy and the cosmetics one I did with his Mom. I've got everything from tartans to spooky backgrounds at this point to play with and I'm making some things I haven't seen. I have a cloth black, white, green, standard screen muslin set up and I've actually made a tie-dye spiral and a gray velvet one as well. I have some wide olive green, emerald green, and brown velvet I may make into backdrops too eventually but with the digital backdrops I've pretty much got an unlimited number of background choices at my disposal.
The CD's aren't too expensive. I think the most expensive ones I've seen are $15 and usually there's at least 10 backdrops on them. There's quite a few free use ones out there too. I got a bunch on DevArt. I would imagine that for holidays, kid's birthdays and stuff I could be quite busy doing stuff like this.
This pic is a demo pic that I've seen pop up quite a bit whenever people start showing how to use a green screen. I used this particular one to show you what a bad green screen pic actually looks like. Whoever originally took this pic was very casual about it. They didn't light the back screen very well and there's a pronounced green halo around the guy. I've actually edited out about as much as I could using the selection tools in Photoshop and put him on a backdrop where it's not too noticeable but even so you can still see the halo just a bit. FYI, it can be very hard just clone out the halo when it's there. I could eventually do it 100% but it would take me a lot longer than I'd like just to show you what I mean. This is me doing a somewhat lazy job. It's actually two faux muslin screens layered plus a warming filter.
But this is what you can do even with straight portraits and a green screen, maybe a quick filter. I kind of like it. It's like the old painted muslin style but it's nicer, warmer, but I only need one screen for many, many looks.
See the faint halo? That's bad. In order to get a clean selection you really have to light the screen evenly. This shot wasn't lit well at all. You can really tell. Even with me doing a quick job of trying to select it out and on a green background it still shows.