It's a standard way for an entity on a Jabber network to present browsable information about itself and its contents, for various definitions of "contents". For example, one can use disco to browse a Jabber host to see what active multi-user conferences it contains, and then use disco on of these conferences to see a list of the users found within (if the conference is configured to reveal such information on request).
Volity uses the expanded service discovery defined by [JEP-0128], which allows a wide variety of information to be attached to disco responses.
These distinct components of the Volity network listen for and respond to disco requests in a predictable fashion, as described on the Wiki page for each.
These parts of the Volity protocol operate by calling and reacting to a series of disco requests performed on the aforementioned network entities.