When I was a programmer we would have killed for something like this. There are a ton of business benefits too. It’s really hard to get all the stakeholders in a system design case to sit in the same room for three weeks to come up with the right structure for a data model. This collaborative ER tool provides people with a way to discuss ideas (albeit at a very limited level) from their own computers and collaborate in realtime on the design.
What this isn’t is a sufficient solution. In these sorts of scenarios, especially when building the first-pass data model for a system, you will spend the first week or more just arguing over the right entities and the implications that that has on the software that you’re building. So bundling this with voice collaboration, IM, and certainly a way to save and retrieve your work, might make this a pretty darn compelling product–or add-on to a development environment.