Apparently Microsoft is looking at ways to improve PC to PC videoconferencing. The following was posted on March 10, 2006 on Time.com.
TIME:What other innovations are coming from your research group?
Gates: Videoconferencing is another good example. There’s more of it going on today than in the past. But it’s still not really mainstream. Even with cameras being very cheap, one thing that researchers noticed was that you look really bad in a videoconference image, because the lighting is bad and you get shadows and things. So they’re showing this software that makes you look good, that understands about shadows and bags under your eyes and highlighting the twinkle in your eye and it’s very realistic. It’s what a great makeup artist would do, but the software is doing that with this face recognition and transformation. And so it’s things like that that will take something like videoconferencing and you’ll start to use it more and you’ll start to think of it and you won’t really realize that a fairly key element was a little bit of magic software.