Windows Live Video Messages has now been updated to Wave3, as promised nearly 2 weeks ago. As you can see it now has the Wave 3 header, so you can navigate easier between all the Windows Live services.
 
Besides the list of updates we already gave you, PicturePan2 spotted the storage space has also been increased from 2GB to 4GB. You may have noticed this storage meter in the screenshot:
 
You can display that after you’ve installed the ActiveX control for Settings (Options > Settings):

Speaking of sending video messages: If you have a LifeCam, like me, you can also install the LifeCam Video Messages Gadget, which makes it even easier to send video messages to your friends.