Basically, the Frame eyetracks you, and it uses that data to prioritize which parts of the overall scene are rendered at what detail level.
That's an accurate description of foveated rendering, but what the Frame has is foveated streaming. Foveated rendering needs to be incorporated in the game, typically at the engine level. Foveated streaming can happen at the system-wide level because it's not reducing the rendering load, but instead reducing the bitrate of the streamed video when you're streaming wireless VR over wifi from your desktop PC or Steam Machine.