This is an optical viewfinder which doesn't show the view through the camera lens but is lined up with it so that it's as close as possible to what the camera will see.
They work very well on cameras with fixed focal length lenses, including Leica's rangefinder cameras and Olympus's E-series Pen cameras when the fixed focal length 'pancake' lens is used in conjunction with the optional viewfinder accessory.
Their advantages are they they provide an extremely clear, bright image which may be superior even to that of a digital SLR's, and because they show what's outside the frame as well as within it, many photographers find they make it easier to keep up with fast-moving subjects and anticipate picture-taking opportunities.
Disadvantages include the lack of any kind of focussing ability (except with rangefinder cameras), a degree of optical distortion and some framing inaccuracy, especially with nearby subjects.
And although they work well on more expensive cameras with fixed focal length lenses, they're less successful on compact cameras. Here, they have to use a zooming mechanism to stay aligned with the camera's own zoom setting, and the result is very small, cramped viewfinders with lots of distortion and poor framing accuracy.
