Maybe I am getting a bit ahead of myself here. Lets start from the beginning. What is 4:4:4? 4:4:4 is a video encoding format (like H.264) which preserves much more information, than let say, ProRes 4:2:2. I dont want to rewrite the excellent article on Wikipedia so if you are interested in that technical stuff, go and take a look. The important thing to understand is that being able to get a feed directly from the HDMI output of the camera that has not yet been encoded has a much higher image quality than what you can get from the H.264 file.
Feeding of a uncompressed video output is nothing new. As described by Philip Bloom article (in the section about the NanoFlash), people have been doing this for years with EX1 or 3 and KiPro. This is a very cost effective way to get high quality edit ready files right off the camera. So far, the main obstacle for achieving this with the HDSLR is the lack of a full HD video out from the camera.
That is where Syndicate 7D Tool comes into the picture. According to them, the output they are able to capture from the 7D(1620 x 910) is the same video crop that is recorded on the CF card by the camera before its resolution is increased to full HD. Their software capture this feed, process it to increase its resolution and smooth the image and saves it as a 4:4:4 file. This is not a true 4:4:4 capture of the HD feed since it ‘creates’ pixels, but should provide a higher quality file than what is generated by the camera since it is not encoded in H.264.
As some people have commented, instead of up sampling the resolution to 1080p, the software should give us the original weird resolution file. We could then use these as oversampling for 720p which is currently the preferred delivery format anyways.
I have yet to hear about anyone using this tool so it still smells like vaporware to me, especially the weird 1620 x 910 resolution. If it proves to be true, it would have a lot of implications for 7D owners.
Now I hear you thinking: when can we get something similar for the 5DMrII? Actually, the answer to this question will probably come from the Magic Lantern firmware hack. Trammel has a video showing full HD out from the HDMI, we just need all the GUI elements out while recording, plug a KiPro and that is it!
As you can understand from this post, a true HDMI out from the 5/7D would have a much bigger impact on the end result than a 24p/60p firmware update, at least for the people shooting films. Unfortunately, this is not something we can expect Canon to give us, if they did so it would really be the end of their ‘real’ camera line. Solutions will have to come from third parties and it seems we are not that far from it!