The distance over which the light's phase stays predictable, roughly the speed of light divided by its spectral width, or wavelength squared over spectral width in wavelength terms. A stabilized single-frequency laser can reach kilometers; a multimode HeNe about 20 cm; an LED only tens of microns. Interferometry, holography and coherent lidar need long coherence length, while OCT and speckle reduction exploit short coherence.
Path difference in the holography setup is 40 cm and the laser's coherence length is maybe 15, no wonder the fringes are mush.
Related terms
Linewidth
The spectral width of a single-frequency laser's output, usually given in Hz, kHz or MHz at half maximum.
Speckle
The grainy pattern of bright and dark spots seen when coherent laser light scatters off a rough surface.
HeNe
A helium-neon gas laser, usually red at 632.8 nm, the classic low-power alignment and reference laser.
Etalon
A pair of parallel reflecting surfaces that transmits a comb of sharp frequency peaks, used to select or measure wavelengths.