Every now and then an App comes along that makes me go WOW! Today that App is Knocking Live Video. This FREE (yes Free) App allows you to send a live video feed from your iPhone to another iPhone or iPod touch running the same App. No the iPhone sending the video doesn't have to be a 3GS. It uses the standard iPhone camera on any iPhone. While this would be great for sudo video calls, you do have to keep in mind that the camera is on the back of your iPhone so you would have to hold it backwards while you talk on speaker phone.
Are you seeing this?
Now you can not only send someone a MMS message with a picture, but you can say "hey, check this out" and send them a live video feed. I'm very impressed with this. Although it doesn't send audio, it does send video even over a 3G connection. So WiFi is NOT required. It also supports Push notifications so that you can "knock" on your firend's or family's iPhone and they can then respond to the request by launching the App and accepting the request. Once they do they'll start seeing whatever you point your camera at. Granted your frame rate/quality will only be as good as your data connection and theirs.
Setup does require registering a free account and setting up a user name. You can then search for your friends and add them to your buddy/friend list. At that point you can "Knock" on them whenever you want.
The Bottom Line
There is no reason NOT to have this App. In my initial tests it works well. Not fluid video by any means, but certainly acceptable and you can't beat the price!