The magnetic cello is an instrument in its infancy and as such it needs to be encouraged and supported. There is no doubt that if David Levi sticks with the project, the device will evolve rapidly into something quite different from what we see and hear today. It has already undergone many important transformations since the earlier prototype.
Let's not forget, the theremin was a flop when it was first introduced. RCA abandoned the project after only about a year, and it did not see the light of day again until Bob Moog single-handedly revived it decades later.
As for Lev Termen's theremincello, it never got beyond the early stage of its development before it was discarded along with the terpsitone and the rhythmicon). So what was the problem?
An electronic version of an acoustic instrument, in order to justify its existence, must be easier to play than the instrument that inspired it, without sacrificing any of the unique qualities that people love and appreciate in the traditional sound.
Is the magnetic cello easier to play than a traditional cello?
Can it play the traditional cello repertoire?
Does it have any advantages over an acoustic or electroacoustic cello?
When you hear it played, do you recognize the signature timbre and impact of an acoustic cello - double stopping, pizzicato, spiccato, etc.?
When you watched the video, did you say to yourself, "Gee, I wish I could play like David and his friends."
Was there anything in the sound of the magnetic cello that you missed when you compared it to the more familiar acoustic cello? If so, was there some other quality in the sound that compensated for whatever you felt was lacking?
The cello evolved as it did, by way of the gamba, in order to accommodate the demands of bowing such a large instrument. The fingerboard faces away from the cellist primarily because there was no way to build a soundbox large enough to amplify and enhance the sound and still have the strings in a relatively "bowable" configuration while the fingerboard was visible to the player (as it is with the cello's smaller cousin, the violin). There are reasons why the cello is built the way it is.
The magnetic cello, on the other hand, does not have the same acoustic requirements and constraints, so is it logical to construct it with the same awkward design? Does it make sense to have a cello "skeleton" so the instrument can be clutched between the knees of the player with the fingerboard facing away? There are no strings, and there is no bow, so other than for pure spectacle, what is the purpose of the design? Is it ergonomic?
I don't know the answer to any of these questions, but I think both the builders and potential buyers of this instrument must ask them.