In many ways it is a clever use of otherwise useless screen real-estate and indeed it would have been the perfect replacement for the entire notifications shade had it been implemented that way.

But its also at the opposite end of the display to your thumb making it useless if you are using your phone with one hand which should be a core requirement of any UX feature.

I get scoffed at by some in the design community for suggesting it but one handed use is a fundamental requirement for when your other hand is busy holding onto children/shopping/the railings on the bus.

P.S. I don't think smudges on the camera are a big issue because unless you're under the age of 17 what the heck are you doing taking selfies?!? ;-)