Making Video edges fade into background?

[chjr]

Does anyone know how to make a video's edges fade into the background? Such as the Grammy's new website? http://www.grammy.com At the top of the page there is a grammy logo with the numbers 1,2,3. When you push 2, a pic of beyonce and prince comes out then a video clip is played. I would like to figure out how to create that faded edges effect. Any suggestions?
Thanks.

[toulouse2k]

This type of effect is done in After Effects, at least the video portion is. It looks like a feathered mask effect.

[chjr]

Cool thanks. I'm going to try to figure it out then.