We had a talk with Bill Anderson of Novint Technologies, maker of the upcoming force feedback Falcon controller/interface. It's come a long way from a year ago, and it's grown a ball.
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How it works: you grasp it with your fingertips in a handshake-like grip, then move it in any direction inspace and it will feel like you're actually interacting with the item on the screen. Example: If there's a rough ball on the screen, the Falcon will vibrate around the surface of the sphere and prevent you from putting your hand through the actual ball itself.
Retailing in '07 for a target price of under $100, the Falcon is geared towards FPS games, sports games, and other games where force feedback is key.
Two videos after the jump.