Advances in VLSI allow us to make cheap cameras and to supply them with powerful processors. To harness these capabilities, we need to move to peer-to-peer networks of smart cameras. Such systems perform distributed video analysis without a central server. Peer-to-peer systems save bandwidth and energy, are cheaper to install, and are more fault-tolerant. The Embedded Systems Group at Princeton University is developing smart cameras and peer-to-peer networks. After describing the application demands, we will briefly describe architectures for embedded real-time video processing in smart cameras. We will then describe video algorithms and network architectures for peer-to-peer gesture recognition and tracking.