The question raised here: What is the mitzvah of Hanukkah? Is it kindling the Hanukkah lights, or is it making sure other people see the Hanukkah lights? In this sugya (conversation/scene), the rabbis try and bring a few different examples to prove their side.
In this first suggested answer, Rava says that placing the lights somewhere is what fulfills the mitzvah. Rava uses the example of someone holding the lit menorah/lamp in their hands. He says it doesn't count until the person puts it down.
However, the Gemara says Rava's suggestion is incorrect, because if someone where to see a person holding the lamp, they would assume the person holding it is just using it for light, not to fulfill the mitzvah of Hanukkah.
The next section asks, "what if someone lit the menorah inside and then took it outside and placed it in the correct spot?"
If it's lit inside and then moved outside, an onlooker might assume that the person lighting it inside is doing it for their own benefit, not to share the lights. That leads us to believe that the action of lighting it is what's most important - as long as it's lit where it's going to be placed, and not moved later.
How can we prove that the action of lighting is what's most important? Because of this example from Shabbat. We can have a lit flame burn all through Shabbat, and then after Shabbat, we can extinguish that flame and relight it for Hanukkah.
However, if we say that the important part is placing the lights, then for this to make sense, the person would need to lift up the lantern after it's been extinguished and before it's relit.
But, even with that circular discussion, the final proof (and deciding factor) that's brought proves the answer: the blessing we say when lighting the Hanukkah lights.