This paper is a sequel to "An Improved diff3 Format for Changes and Conflicts in Tree Structures" [1] and again is focused on the diff3 format rather than the diff3 executable application. In this paper we will develop an XML alternative to the diff3 format from GNU diffutils [2]. There are many possible outputs from diff3 but the one we are interested in is the one that provides a merged file result with conflicts marked up, i.e. the '-m' option on the command line.

Many users do not view diff3 data directly or invoke diff3 itself, instead it is often invoked by a version control systems such as git or mercurial when the users merge a branch, graft or cherry-pick, rebase or change branches with working directory changes.

A characteristic that we seek from the start is that as the number of changes tends to zero, so the diff file tends to resemble the original files. This is desirable in that minimal processing is needed for few changes and human understanding is improved simply because when the diff and the original files are very similar they will look very similar.

We distinguish between the 'carrier' syntax which is the diff3 alternative, and the 'payload' which is the content of the file(s) being compared or merged.

In our previous paper, we considered both XML and JSON as a candidate for the carrier syntax and established that XML is a more natural fit, with the payload of the original files being, typically, not XML. However, of course this could be applied to XML itself and then there is likely to be at a human readability level a confusion between the payload and the carrier, and we will look at that in this paper.