Face time is a combination of marketing hype and actual functionality. Apple's number one goal was one upmanship, a game they play better than anyone. It's really about wowing the more gullible into thinking Apple has the market cornered when it comes to (in Apples words) "Magical & Revolutionary".
A proprietary system locking out others and only available to iPhone 4 owners, it's not been much of a success. But it was a great gimmick in the beginning. In my family of five iPhone 4 users, we've only used it a few times. Once the newness wears off, it's just another wasted feature we don't use.