Emanuel Tov's "The Textual Criticism of the Bible: An Introduction"
(1989, Hebrew, p.
40-41) makes the following points:
1) This is an early system of chapter (not verse) division. A large
chapter would be
signaled by a space till the end of the line, and a sub-chapter would
be signaled by
a space that doesn't reach to the end of the line, and in later
convention would be
only nine letters wide.
2) This is attested in a whole variety of early texts: Biblical
scrolls from Qumran
(Psalms, Isaiah a, Paleo Exodus), as well as Greek scrolls (Greek Minor
Prophets
from Nahal Hever). It is also known from non-Biblical scrolls from Qumran,
and
Greek and Aramaic texts from the Hellenistic period.
3) Studies on Isaiah a show that in 80% of the cases there is agreement
between
the spacing divisions of the Isaiah a scroll and the Medieval manuscripts. A
similar result is obtained for the Minor Prophets from Wadi Murabaat.