Rocksmith 2014 developer Ubisoft San Francisco opted against using Kinect's camera and sensor technology in the game due to technical limitations of the Xbox 360 peripheral, lead designer Paul Cross told IGN.
The studio initially intended to introduce a system that recognized and rewarded classic guitar postures, such as Pete Townshend's classic windmill arm movement; however, the 360's Kinect capabilities were too limited. According to Cross, in its current generation form, it is unable to distinguish the player's arm from the neck of the guitar.
Rocksmith 2014 does however make use of the Kinect voice activation system, despite scrapping the camera functionality. You can check out our recent hands-on preview of the game and interview with Cross here.