A online video purports to show two people playing the classic video game Pong using what looks like an an EEG machine to read electrical activity from the brain.
Although I’m no EEG expert, the kit looks authentic and it’s certainly a technically possible feat with the current state of neurofeedback research.
So if anyone can actually verify whether this was genuinely an example of ‘mental pong’, or knows more about the event being filmed, I’d be interested to find out.
Link to video of ‘Berlin Brain Computer Interface’.
Mind Hacks 
It seems legit, assuming this video does actually display a demonstration of Berlin Brain Computer Interface (BBCI) technologies. You were correct to identify EEG recordings as the input to the computer that controls the board movements. The specific signals used are the EEG signatures corresponding to motor intentions. Apparently BBCI has also developed a machine learning algorithm that allows it to hone in on individual, idiosyncratic versions of these EEG signatures.
Some links:
http://ida.first.fraunhofer.de/bbci/index_en.html
http://www.eurescom.de/message/messageDec2004/The_Berlin_Brain_Computer_Interface.asp
http://www.newscientist.com/channel/info-tech/dn8826.html
More in-depth material can be found using Google:
http://www.google.com/search?hl=en&lr=&q=berlin+brain+computer+interface&btnG=Search
http://www.google.com/search?hl=en&lr=&q=berlin+brain+computer+interface+pong&btnG=Search
Berlin Brain Computer Interface is apparently developed by Fraunhofer Institute and Berlin Charite and the video shows a demonstration that was attended by the then German Minister for Education and Research Mrs. Bulmahn.
The German government is funding this research.
Further steps will be a non-touching EEG.
See more at http://www.bernstein-zentren.de/de/105.php – in German actually.