It doesn't necessarily mean many people nearby at one time, it could just mean a lack of walls (or very low walls), so that people who walk by are a distraction. I worked in an office like this for a while: there weren't many people sitting around me (it was pretty empty actually in my sector), but I was in a low-wall cubicle next to an aisle, so there was a constant stream of people walking by my desk, with their heads constantly appearing over my monitor. It was extremely distracting.