Yeah...the pic is blurry. It does look cut though. If it is, the grease inside the boot will heat up when the car is driven and begin to leak out. At some point the joint will become dry enough to finally fail. Generally the first signs of failure are a clicking sound when turning.
As for what to do? You could continually inject grease into the boot every few days and it may last forever...who knows?
Another fix is to cut off the old boot, including the bands at each end and use a universal "split" repair boot. They can be kinda hard to work with. The joint needs to be repacked before installation. CLICK --->
http://www.autozone.com/autozone/rep...uctInformation
Another option is to remove the axle and then remove the actual CV joint and install a replacement boot. CLICK --->
http://www.partsgeek.com/mmparts/cv_...yota/echo.html
Or you might find that an entire rebuilt axle (sometimes called a driveshaft or half-shaft) is much easier to work with. CLICK --->
http://www.autopartsdeal.com/Parts_L...t/toyota/echo/