Ubuntu 12.04's CD default image is to become larger, gaining additional 50 MB, meaning, in order to be installed, Precise Pangolin would require a USB stick for the CD .ISO (as opposed to the DVD image).
This topic has been discussed at UDS-P by Mark Shuttleworth, Jason Warner and other developers that are trying to make a compromise between the CD approach and the additional features that are to land in Precise.
Canonical's Jason Warner explained that there are always difficulties caused by the 700 MB limit and, even small 2-3 MB extra sizes can produce troubles (the developers must find what to remove and sometimes they barely find that "stuff").
Mark Shuttleworth emphasized that a middle approach should be embraced, keeping the regular DVD image and adding a slightly increased size for the CD image, 750 MB, that is to be "burned" to a USB stick.
Those 50 MB would allow developers sufficient space to deliver an excellent Ubuntu experience and, in the same time, keeps the clarity and optimal management in what should be/shouldn't be on the CD.
Obviously, the USB stick expression has been used due to its notoriety among the users (a USB is just as known as a CD), but the probable 750 MB could be easily burned to a larger CD (800 MB) or a DVD.
This hasn't been yet approved on launchpad, so things can evolve and change.