To be honest, I've only ever used my Kinect for a video chat with a friend of mine once. We'd both just bought it and wanted to try it out. It wasn't exactly the easiest thing to link up with each other, and once it did, the video quality was a little... well, it's not great. The Kinect is an impressive bit of motion control technology, but it's not like it's any of the multiple cameras are HD-quality!
But at CES, Microsoft revealed that you'll be able to chat with your friends using your Xbox 360 Avatar, and even hang out in virtual chat rooms. I've never been one for online chatting, and video chatting doesn't really interest me either, especially if you're just hanging out with Avatars. But it's cool that Microsoft is continuing to come up with new ways to use the Kinect (I'd still like some awesome games at some point, though), and the fact that you can record the chat session and share it online has me very intrigued to try and do some Avatar-style group video podcasts!