For more on the service here's an their overview:
Yahoo! Live lets you create your own social broadcasting experience. Display, hack and mashup live video streams on your website or client application. Using REST, you can query our streaming servers to find people broadcasting on Yahoo! Live as well as information about those broadcasts and the people that are viewing them. A unique feature of Yahoo! Live is that other people with webcams can be part of the main broadcast that they are watching, as a "coviewer". Use this API to mashup broadcasters, coviewers, and anything else on the web that might be relevant.
On launch today there have been some stability issues and Yahoo!'s Chad Dickerson points out that this is an experimental service and they anticipated load issues: "Keep in mind that Y! Live is an experimental release. The Advanced Products team is a small incubation team at Yahoo! – our mission is to build stuff and launch it quickly, and respond to market feedback. Y! Live is a limited capacity release, so bear with us as and we may reach our limits in periods of high traffic."
Yahoo continues to add APIs to their stack and now offer 27 APIs.