I think one could consider this more or less vaporware, considering I haven't heard anything about it on some well-known tech websites since the initial announcement.
It's an idea; we'll have to see it tested in real world conditions to see if it's viable. Looks cool though. Water cooling isn't the best considering it has more failure points than an fan/heatsink cooler.
There's no water involved. It's shaped like a hockey puck. Looking down on it from above, there's a hollow circle in the middle, from which the heat sink fins radiate to the outer edge of the circle like the swirly striping on a classic (disc shaped) after-dinner peppermint. Instead of separate fans pushing and/or pulling air across static heat sink fins, the fan blades ARE the heat sink fins. Simpler, more elegant design, and according to quite a few articles from June 2012, it's way more effective. And because the heat sink fins are constantly spinning, they don't collect dust, either.