Nobody really knew what it was all about...

...maybe they were just showing how it could look like when you created your own Avatar for the new PSN, PS Home or maybe for future games that  will allow the use of Avatars.

Everyone kept saying that Sony should allow the Sackboys as Avatars, so maybe they have just gone a step beyond that.

...of course it would be rather short-sighted, as they couldn't sell any shirts or hats with micro-transactions

it was a tech demo of what could be done with PSmove. They were just toying with some ideas, nothing more, nothing less.

So now we are going to see dick shaped sculptures as avatars. Bad idea if that was the case.  Just a tech demo though

Weird that after all this time they oy showed a tech demo

I really believe it was actually a game being shown. You will be able to sculpt various things, use them to create scenery, objects and characters and then animate them like in the demo. How difficult will it be to create something that looks decent though? That remains to be seen, but probably very difficult.

IMO Media Molecule has been wasting time.

LBP2 was so long ago, they should have a game READY for PS4 launch by now.... instead all they have is "proof of concept" that may or may not be put to use

they showed the level editor for LBP 3D. quote me.

unless this is somehow related to a project it would make sense that they would wait until E3 to show their game

This is Sony's Milo