It looks awesome !
That Jim Sterling comes off as fool. He obviously doesn't get what it can do. We all know its about games, the event was about all the cool new stuff it can do, and it is cool ! It has HDMI input and IR output which is how the control Live TV and use it as a switcher. It will be able to interact with any cable box or IR capable device. Funny thing is that could be a PS4 or an Apple TV upstream from the Xbox.
And please enough with the privacy BS. Every PC, Mac, smartphone and tablet has a camera & mic that has potential to always be on.
Personally I doubt the "always connected" part will really see the light of day..