It says the new standard is called XBG3. Current Xbox 360 discs have a capacity of 7.95GB, though 1.15GB of this is dedicated to a DVD-Video partition and various anti-piracy measures.
Doing away with these requirements will give developers around 15 per cent of extra storage to play with.
The site speculates that MS would be happy to ditch its current anti-piracy tech as the machine has been so widely hacked. It also adds that it could be an opportunity for the platform holder to introduce new security systems.
Those who sign up to the scheme in the US will receive a free copy of Halo Reach that, presumably, will built using the new format.