Currently we have DVDs and these hold about 4Gb of data. The data on them in read by a red laser.
Some companies discovered they could hold more data on a DVD by putting the data closer together and reading it with a blue laser.
Two main groups of companies worked on competing systems for this, one called "HD-DVD" the other called "Blu Ray".
Both systems are now available. They are the same size as a DVD but hold about 30 or 40Gb of data.
You need a HD-DVD or BluRay player to read the disks, and some companies are already releasing films on HD-DVD and Blu Ray.
Microsoft have decided to go the HD-DVD route and the XBox 360 can have a HD-DVD drive.
Sony are going the Blu Ray route and the PS3 already has a Blu Ray device in it.
Over time one or other of these system (or both) will replace the current DVD, but as it is early days most people are sitting back to wait and see who wins.
Most of the technology is expensive anyway.
More here (or search on Blu Ray or HD DVD)
http://www.blu-ray.com/info/
http://www.thelookandsoundofperfect.com/