Microsoft's SideSight: Something Apple Should Watch

The only quirk I see, as opposed to multi-touch (iPhone) is that you'd have to set this device down or hold it in very awkward ways. If you're at a desk that's fine, but it'd lead to precarious situations with not holding on very securely to your device.

Neat but I can't imagine what useful features would require me to wave my fingers around the phone instead of touching the screen.