Prior to iOS 7, the native camera application’s video option could not zoom while recording. There have been many third-party applications, such as MoviePro, which have had zooming before, however, they usually require post-processing once the video is over and they don’t integrate right into the lock screen like the native app.
The quick video below shows the new zoom function in action. Be sure to enable HD mode to see just how crystal-clear the video is even with full zoom. The video zoom doesn’t pan in as close as the still image zoom, but it still manages to work up to about 2-3x or so. To top it off, there is no post-processing necessary after the video is taken. It saves to your device just like a regular video and can be replayed instantly.