Is this used in any games? It sounds like something that would be a bit cpu intensive for realtime use. Does it make scenes look better?
Without it you are forced to use lightmaps to give diffuse lighting in a scene. Of course a lightmap can be rendered with excellent tools and gives better results overall. However, detailed maps need a lot of vram, and preprossing requires time. By processing maps in realtime you can apply them everywhere even when working with vast maps, and also use lighting maps in certain spots if needed. Also, the result would not be static, so the lightmap would change in realtime if - for example - a wall rumbles down or a truck parks near a wall.
It will be more and more used during time, as it happened with radiosity in CG. Prototyping becames a lot faster as well, if you don't have to fake everything and process lots of maps.
Why not drop the concept of ambient altogether?
But we have ambient light in the real world too. So far it was faked, and technology is taking its first baby steps into realtime simulations of it.