Apple announced iPhone 4 at their WWDC 2010 keynote today, and Steve Jobs reserved the "One More Thing" portion of the presentation to discuss more about its video calling capabilities.
Video calling on iPhone 4 requires that both people be using an iPhone 4 device. Video calls can be done using both the front and read camera's on the device and require a Wi-Fi network to work, no 3G support. Apple is calling this feature "FaceTime."
Jobs did also mention that Apple "need[s] to work a little bit with carriers," meaning that the Wi-Fi only restriction will likely be short lived.
