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Template programming in C++ is a powerful feature that enables developers to write flexible and reusable code that can operate with any datatype. By using templates, a programmer can create a single function or class to work with different data types, eliminating the need to write separate code for each type. In the context of function templates, they are defined using the template keyword followed by a type placeholder inside angle brackets, denoted as <typename T>. This type placeholder can then be used within the function definition to represent any data type.

For instance, consider a function designed to display array contents. Using template programming, we can write one generalized function instead of different functions for each possible array type. This not only saves time but also helps in maintaining and updating the code efficiently. The exercise is a perfect example of function templates in action, displaying array contents regardless of whether the array contains integers, floating-point numbers, or strings. The primary advantage here is code reusability; the same logic applies to an array of any type, thanks to the abstraction provided by the template.

Generic programming is an approach in software engineering that emphasizes writing code that can work with any data type. It promotes the use of algorithms and data structures that are decoupled from specific data types and can operate on a range of types as long as they meet certain syntactic and semantic requirements. The philosophy behind generic programming is to make software components more widely reusable, thus reducing code duplication and the potential for errors.

In C++, generic programming is mainly achieved through the use of templates. A template can be thought of as a blueprint that allows the generation of a family of functions or classes for different data types. Templates respond to the 'Don't Repeat Yourself' (DRY) principle, which is a crucial aspect of good software design. The step-by-step solution provided shows generic programming in action: the template function displayArrayContents is generic as it applies to any array of any data type. This is a classic example where template programming intersects with the ideals of generic programming to produce code that is both abstract and versatile.

Array iteration is the process of sequentially accessing each element of an array. In C++, this can be done using indexing with a loop structure like a 'for' loop. Iteration is fundamental when dealing with collections of data, such as arrays, where operations may need to be performed on each element. The purpose of an iteration can vary from simply displaying each element to performing complex computations.

In the provided exercise, the for loop is used to iterate over each element of the provided array. With each iteration, the loop increments the index i, and the currently indexed element arr[i] is then accessible and can be displayed using cout. The loop continues until all elements have been processed. The approach taken to iterate the array within the template function is succinct and demonstrates the power of using loops to handle arrays in a generic context. The simplicity and adaptability of this approach emphasize why loops are a cornerstone in array manipulation tasks within programming.