In fact, it was being worked on around the time of the Playstation 2, when the Eye Toy was new. Check out the video above and you'll actually see Dr. Richard Marks demonstrate a similar concept to the PS3's motion controller on the PS2.

The PS2 version clearly isn't doing 1:1 tracking, but it's still rather impressive. Check out the E3 demonstration after the jump to compare how far the technology has come.

It's the hand-writing that gets us.