During the introduction yesterday, there has been a lot on the "FaceID Fail", but when I saw it again, here is what I think happened.
TouchID needs to have your passcode when you first log in to enable it
It appears that during this demo, the phone was first turned on, and needed the passcode to enable FaceID, just like TouchID. When it said, "Enter Passcode to enable FaceID," that was my clue that it was intentional.
His only failure on this was not acknowledging that this is normal, and intended behavior
TouchID needs to have your passcode when you first log in to enable it
It appears that during this demo, the phone was first turned on, and needed the passcode to enable FaceID, just like TouchID. When it said, "Enter Passcode to enable FaceID," that was my clue that it was intentional.
His only failure on this was not acknowledging that this is normal, and intended behavior