The action starts just after 1:44.
ArcAttack ~ America's Got Talent, Top 48 week-4
YouTube via AmericanBestTalent | August 03, 2010

via Gizmodo where you'll find more pics and info.
"The fret board is 72 optically isolated switches. The fret board, instead of frets has 6 brass contacts per fret. When the string is pushed down to the contact, it makes a connection.
From there the signal is optically isolated, to protect from EMF and sent to a micro controller thats only job is to priority encode the fretboard, and keep tabs on which string is pushed down to each fret.
So priority encoding means this basically: if you are playing the 6th string on the 12th fret, then the computer ignores if say the 11th and 10th frets are pressed on that string also, since the 12th fret needs to take priority - just like a real guitar..."