Sober Thal said:
But neither of them are looking up?!?!?
I say fail, but in a cute way.
Actually, I think they're holding the PS Vita offscreen low, and a separate camera is filming them from straight on. The idea is that you'd have an anonymous avatar (terrifying nightmare fodder as it might be), synched to your facial/head movements through the PS Vita, so it makes sense that you can't or wouldn't get the video data from the actual camera doing the facial mapping. The video of the users that we're shown is, essentially, completely independent of the terrifying puppet faces.
Now, I bet you actually save a fair bit on bandwidth, only sending animation instructions and audio, rather than full motion streaming video.
What I wouldn't mind seeing (on Vita, Kinect, PS Eyetoy/Move, or PC Webcam) is this sort of camera to facial animation tech being used to animate avatars in online games; sure it might just be a gimmick, but being able to talk to others in, say a game of Battlefield, and having the faces animate appropriately, with rudimentary lip-synch, or being able to actually nod to a friend in a co-op game of Rainbow Six: New Vegas 12 or Call of Honor 9 to signal when to enter and clear a room. That's a nifty improvement that I personally think would be pretty nifty.
Heck, why stop there if you can do head tracking with that level of reliability; incorporate TrackIR-type head tracking into FPS's (keep it subtle, but that added bit of visual freedom is incredibly helpful (just ask anyone playing ARMA), racing games, flying games, etc. Personally, I'd go for the ability to glance around my environment over 3D displays and glasses any day, but that could just be me.