ProctorU does similar things for universities. I've taken a few, they're not always this intrusive, but I understand the sentiment. People cheat. It's hard to stop that and even harder to do remotely.
Attempting to take over a person's own computer in order to prevent cheating on a test is simultaneously an egregious invasion of privacy and completely insecure. Are we really supposed to believe that you wouldn't be able to hide some cheating materials from your own webcam?
I'm certain it's more expensive for the company, though. And some candidates don't have nearby access to this.
The tests were held at the schools, all online. Purses, bags, jackets, electronics and so forth were left at the front of the room. Paper and pencils were provided in the computer labs, which were recorded and inspected for signs of cheating. Humans were at the site, but video wouldn't have been out of the question either.
It wouldn't seem too much to be able to rent a local school's computer lab for these sorts of purposes, for a small fee. And the internet and security on these is already tax-payer funded. This should put test taking environments well within reach of most people.
As a software developer - I alwasy kind of cheat. I use Stackoverflow and infinite google search abilities :)
In that instance, in your daily job you wouldn't even cheat by looking it up, you'd just use a library. I would assume that they value people who understand how these things work rather than just being able to implement it. After all, you can teach someone basic Python and how to use Scipy in a couple of hours, but does that make them a data scientist?
Anyway my point is lots of companies have programming exercises/tests, and I'm not aware of too many that let you just look stuff up while you're doing them. Debate the merits of that, but it's common enough that seeing it in this platform shouldn't feel totally shocking.
To be fair, those people are very likely to be successful!