The deicision was a big step forward; however, moving off XML to an equivalent but less verbose (in number of meaningless bytes) format wouldn't hurt. All else being equal, it would be less electricity wasted on reading and sending things over the wire, and also more human-readable format. See also: SEXP vs. XML.

This argument applies the more, the bigger markup-to-data ratio is.

The wide availability across numerous platforms of robust libraries and tools for manipulating XML along with its standardization and the ubiquity of its implementation might have played a role in Microsoft's decisions.

its zipped; nothing is wasted.

But to read it you have to first unzip it, and then parse all that fluff.

See also the "wide availability across numerous platforms of robust libraries and tools" to do this, and do it quickly.