This is called RSVP. It is easier (for the same WPM) with 2-4 words at a time than 1 word. I really hope this catches on more and allows different chunk sizes.
500 wpm with no training is an exaggeration. wpm also depends a lot on which book you're reading. however, RSVP is the fastest way to read and way over 500 wpm is possible with practice.
Their FAQ seems to suggest it's more than RSVP, the addition of the red 'centre' and the differing alignment (not centred on the middle of the word but slightly to the left). I've used both and I found Spritz more comfortable on the eyes, less eye movement.
500 wpm with no training is an exaggeration. wpm also depends a lot on which book you're reading. however, RSVP is the fastest way to read and way over 500 wpm is possible with practice.