Looks like MS has come up with a way to implement full gesture recognition without a controller, using two EyeToy style cameras.
Link.
Certainly looks cool, although with no controller to go along with it, a gamer will be hard pressed to actually play a game using it. Much better than Sony's craptacular attempt, but still not as good as the Wii controller could potentially be.
360 gesture recognition
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Arthur_Tuxedo
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360 gesture recognition
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