Apple has just approved and released an application that’s generating quite a buzz for iPhone 2G and 3G users, the iVideoCamera (iTunes Link). Apparently Apple is not too concerned about restricting video capabilities to the 3GS anymore. For the low price of 99 cents iPhone 2G and 3G users can record video on their iPhones. Granted it doesn’t great quality yet, as the current version only captures video at 3 frames per second. However with some updates under its belt, who knows what we will get? The 3GS might look mighty pricey compared to its older brethrens with this application installed. In fact this is the second recent app released by Apple that provides video capabilities to 3G iPhone users. UStream Broadcaster also shoots videos and then stream them live to any browser.

So what does iVideoCamera actually do for 99 cents? Opening the app gives you a simple video viewfinder and a start/stop record button. Videos are limited to 3 frames per second and a recording time of one minute per video. It will stop automatically at one minute. You can share your raw product to YouTube, Facebook, or Vimeo. From there you can save it in your camera roll on the iPhone. You can even trim it on your 3G, much the same as a 3GS. Video quality will not be spectacular at 160×213 resolution and the 3 frames per second looks choppy, but how much do you really expect for a dollar?

So there you have it. Some have questioned Apple’s thought processes in releasing this app and wonder how long it may last since it may slow the number of iPhone 3G users upgrading to 3GS (But the 3GS also have the unique ability to utilize augmented reality apps). So if you have a 3G iPhone make sure to snap this up quick! But if Apple is just concerned about making money off applications this may stand the test of time after all. And just a word to the wise for 3GS users out there, this application does not work properly on your phones, so don’t bother trying!

For those of you who are wondering about the video results from the iVideoCamera app, check out the video below.