The butterfly has become very popular with most
goalies in the NHL and other top leagues today. The butterfly
does not cover more net but the save is more effective. The
butterfly, done properly can cover the whole bottom of the net
and most of the top. 
Here you see the goalie down in his butterfly (left shooter's
view) covering the ice well. This is a great move as long as
the goalie uses it in right types of situations instead of making
it "the patent" for all his saves.
Use the butterfly when you don't know where the shot will
go,
or when you need to put good coverage in place for close plays,
screen shots, deflections etc.. When you can see the shot just
make the save standing up and be ready to move for the next
one.
The butterfly position:
1: Drop to your knees, slam your knees down to close the 5
hole shot.
2: Flare the legs. Move your legs outward to get more of the
corners for those low corner shots.
3: Your stick should be comfortably positioned in the gap between
the legs (in the middle). This is most important in the butterfly
position. Use the stick in a circular motion to deflect the
puck to the corner.
4: Your blocker is positioned so that the stick remains in
the middle. Keep your arms close to the body or tightly locked.
The more holes you can close, the better.
5: Many like the trapper hand low and on the pad, but your
gloves should be at the same level as when you are in your standup
position. It is also important to keep your arms tight to your
body.