Video demonstration: TimeHue (Vimeo)
To read the clock, start from the center and move outwards: the hue of the small circle represents hours, the middle continuous hue represents minutes and the surrounding outer hue represents seconds. The segmented color wheels are merely there for reference, broken into 12 color segments for hours and 60 color segments for minutes and seconds.
The current time is 00:00:00
An iOS (iPhone, iPodTouch, iPad) version is now available on the iTunes AppStore here: TimeHue. An Android edition of TimeHue will soon be available on the Android Marketplace.
A web-app compatible version can be viewed here.