Dreams do come true, sometimes. After their live video streaming app got rejected, developer Pointy Heads Software made an impassioned plea to none other than Apple CEO Steve Jobs. The result is now available for download in the App Store, and is a positive sign that developer complaints are being taken seriously by Apple.

Knocking Live Video is the first official iPhone app capable of streaming live video over both 3G and Wi-Fi connections, according to Ars Technica. The app relies on a private API, well known amongst developers, which is a good sign for future video-based apps that it was approved.

The premise behind Knocking Live Video is simple: Stream live video from one iPhone  to another. Launch the app, find a username you want to share with and “knock-knock” to get their attention via push notification. When they answer, the live video from your iPhone camera will be magically beamed to their handset. An iPhone 3GS or iPhone 3G is required to transmit the video, but any other iPhone or iPod touch can receive and view the stream (via Wi-Fi, of course).

Services like Qik are already designed to stream live video to multiple devices, but the iPhone version is neutered in that respect — it can only upload to the Qik website for later viewing. “We are focused on phone-to-phone, not uploading to the web,” Pointy Head developer Brian Meehan explained to Ars. “Who really cares about fleeting moments other than friends and family seeing it as it happens? With Knocking, people share what they are doing right now. Our testers have referred to ‘knocking’ as a ‘visual tweet’.”

The magic would never have happened without Steve Jobs. Because the app used a private API for capturing live frames from the iPhone’s screen, it was initially rejected. “When it was rejected, I decided not to give up and reach out directly to Steve Jobs via e-mail,” Meehan explains. “I reached out to Apple to reconsider our application due to its potential to culturally change how people share live moments phone-to-phone.”

Within three hours of a phone call from an Apple executive stating that the app was now approved — “directly from the top” — Knocking Live Video was on the App Store Tuesday and available for free download.