Microsoft Channel9′s Laura Foy recorded an amazing demo of a soon-to-be mass-market water-repelling technology being showcased at the Mobile World Congress 2011. The infamous Arthur C. Clarke quote “any sufficiently advanced technology is indistinguishable from magic” couldn’t be more true here.
I’m glad she got it on video because she would have had a hard time convincing people otherwise. “What do you mean the tissue was dry inside a bowl of water.”
Wikipedia has a brief but simple explanation of the magic science behind all this and there’s also some great demo videos on the P2i’s company website.
Although I’m not sure if it’s plausible, this could be an interesting way to make phones submersible. Imagine being able go for a swim with your phone in your pocket. Windows Phone 7′s pocket to picture feature would be even better, underwater.

During Microsoft’s PDC09 developer event in November last year, 
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