Microsoft really wants you to buy a Kinect, their fancy motion-centric camera that you can look like an idiot while playing and while talking to. For longtime players though, it's not all that new.
In fact, it feels awfully similar to the utterly ignored Xbox Live Vision Camera, a little webcam-looking device that tracked motion, allowed for video chat, and had specific games made for it. Microsoft, well, they didn't really want you to buy that even when it launched in 2006.
If you want a conspiracy theory (and it's the Internet, so who doesn't?), the Vision Camera seems to have served an an extravagant beta for the Kinect. All the Vision Camera lacked was voice and facial recognition, which, for the leap in technology the Kinect is, all seems like a natural evolution.
Microsoft truly did ignore the Vision Camera, and third parties (for the most part) could not have cared any less. Microsoft only issued three games that used the camera, a clumsy and embarrassing platforming game called Totemball (which was a free download and was still too expensive), an equally looney You're in the Movies, and Viva Pinata: Trouble in Paradise, which let players scan special cards to unlock items. No one really cared because no one really bought the unit in the first place.
However, the Vision Camera is not a lost cause. In fact, you can still use it to map your own face onto characters in games like recent editions of Tiger Woods PGA Tour or Rainbow Six Vegas 2. It's admittedly a little creepy to see an in-game character drop dead, your own cold, lifeless eyes staring back at you, but in theory it was nifty.
All the Vision Camera seems to have left to offer is facial mapping, meaning most have by now disconnected the little peripheral that could, or maybe they use it as a webcam. The USB device can be hooked up to PC running Windows XP, and it kinda/sorta works on Windows Vista and Windows 7 (the kinks were never worked out). Even the Mac and PS3 can enjoy some Vision Camera action after a firmware update allowed for USB video class devices.
As far as the 360 goes though, the Vision Camera is a relic of an era where Microsoft seemed to testing the waters. Don't expect any more games or support. In Microsoft's eyes, it's been shuttered.