By slapping together old-school arcade games and a cameraphone, Arcade Reality takes a significant step forward in mobile gaming. Sure, the graphics look absolutely atrocious, and that promo video is laughably bad, but the concept is a good one.

By placing graphics over what your cameraphone sees, Arcade Reality makes the world your playing field and your phone the controller. Aiming your phone at bad guys that appear in the space around you, it kind of combines the active nature of a Wiimote with a light gun like the one that came with the original NES.

I can't wait to see where this type of game goes once some serious development dollars get put into it. Who needs a pop-out joystick when your entire phone is the controller?

Product Page [via Red Ferret]