I interpreted his LED idea to mean that a lighting system could use multiple types of LEDs, providing video data in specific frequency bands. Software filtering could be used to isolate these, then recombine them in different proportions to get the right 'feel' in color.
If different types of LEDs were positioned far enough apart, you could possibly achieve different lighting angles from one scene-shot. Compare this with shooting a scene multiple times while having the crew reposition lighting. Such a system would indeed be more costly, but could reduce human repetition.