When firmware update 1.54 hit PS3, one of the features Sony added was: "You can now use a compatible USB camera (webcam) compliant with USB video class (UVC) for video chat."

Lo and behold, the Xbox 360 Live Vision Camera is a USB webcam, does it work with PlayStation 3? The answer is yes, says Gaming Bits. Ironically, the Xbox 360 camera works with PS3, but the 360 itself won't work with any other cam except for their own Live Vision.

Sony's got a more flexible system in this regard.

Video chats on the PS3 also support more people chatting together than the limited two-way video chats on the Xbox 360. Firmware 1.54 also lets you go into a full screen mode with video chat, which you cannot do on the 360. Unfortunately, the lag time can make video chatting on the PS3 a pain to use. Even during a voice-only chat, the lag time was pretty bad (about 3 seconds). Oddly, voice chat while on Resistance: Fall of Man has less lag than chatting from the PS3's main interface (XMB). If you don't have an Eye Toy or don't want another camera around your entertainment center, the Live Vision Camera is worth using.