This solution is utilizing PCoIP[1] which is a very mature protocol that can support things like video streaming, adaptive compression, and remote USB device passthrough. It's nothing like VNC or X11, and I have a number of customers running thousands of users with it. VMware also licensed this protocol for their View product and it's been very successful in that space. While I generally prefer the ICA/HDX stack for VDI use, PCoIP is pretty damn nice and it's a great choice for this kind of offering.
I second this. The protocol is incredibly fast, even over a cellular connection when zipping down the rail line on Amtrak. On a LAN I can use VMware PCoIP on an Apple Cinema Display and there is zero lag (hard to test the Cinema Display on Amtrak!). I don't know what black magic they use under the hood, but it's the only remote protocol I've ever used that didn't make me want to throw my computer out the window.
Sounds interesting, i wonder if something like this will replace home computing in the future. How is the performance when watching videos or playing some casual game, does that still work ?
I haven't done any gaming with it, but web video played in the browser works the same as locally. I haven't tried any full screen stuff like movies though. For regular application usage there is no perceptible lag for things like scrolling, editing, highlighting, etc...
[1]http://en.wikipedia.org/wiki/Teradici#PCoIP_Protocol