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Better than the old "Disk busy" icon.
It means the disk is busy writing to the hard drive. Normally it's unpacking something.
The speed you can download and the speed the hard drive can work at won't match, if you try to download faster than it can be written to the drive, the download has to stop until the disk has caught up.
Think of a tap running into a large bucket and you are using a smaller bucket to put water somewhere else, eventually you'll need to turn the tap off to stop the big bucket from overflowing. Once you've got back to a decent level, you can turn the tap on and continue.
Disk Usage is how much data is being written / read on your storage device.
If you download at 5Mbps it has to write 5Mbps to your HDD/SSD to store it. If you download faster than your HDD can handle or the HDD is busy reading/writing other files, then you can end up with a backlog which means Steam has to halt the download / slow it down to allow the catch up.
It's used on Steam to diagnose those kinds of problems.