I'm pretty confident it's just installing part/all of the game onto the HDD in order to improve the load times.
And even then, in the interview, Takahashi said that the game world really IS seamless. You can run from one end of the map to the other with NO loading. He said the cutscenes are what will cause some load times.
Upcoming Games To Get
Definite: Kirby Star Allies (Switch), Mario Tennis Aces (Switch), Fire Emblem (Switch), Yoshi (Switch), Pokemon (Switch), Kingdom Hearts 3 (PS4), Monster Hunter World (PS4)
Considering: Fe (Switch), Donkey Kong Country Tropical Freeze (Switch), The World Ends With You (Switch), Ys VIII (Switch), Street Fighter V: Arcade Edition (PS4), Kingdom Hearts 2.8 Remix (PS4), The Last Guardian (PS4), Shadow of the Colossus HD (PS4), Anthem (PS4), Shenmue 3 (PS4), WiLD (PS4)