If you’ve ever experienced USB 1 transfer speeds, they were horrendous, USB 2 went some way to fixing this, and for most applications, USB 2 does the job quite adequately. However as usual there’s new technologies that increase speeds even further.
In this instance we’re talking about USB 3.0. As this article point out, speed increases are made by adding fiber-optic cable in addition to the copper cable which increases speeds tenfold up to 4.8 gigabits per second.
The article mentions one possible utilization for the speed increase is HD-DVD and Blu-ray movies, however the xbox 360 HD-DVD add-on drive works just fine using USB 2.