Honestly, thats a tough one. Sometimes its better to be a good witness than a poor hero!
Seeing how the beginning played out the attacker left plenty of opportunity to hit him with a few rounds, which was my first thought, he leaves his body wide open to you and doesnt seem to even pay any mind to the other person there. However even at the close range you could easily miss your target. Adrenaline pumping into your system, your heart rate and breathing increasing, tunnel vision, and in the video you can see in just a few seconds he turns and the only thing you see is the "hostage" who is facing you.
Then he lets them go and calmly seems to walk out. But do you shoot them in the back? A jury might not be too keen of seeing someone who has disengaged and leaving being shot in the back, to most, at that point they are no longer a threat as they are retreating.
Its one of those situations where its great to monday morning quarter back and say you would shoot, but I think in this case unless he killed the hostage and started shooting I would keep my gun holstered and not try to present myself as a threat and just be a good witness.
As some of you will remember, during the robbery at the internet cafe in Florida the old man who shot the robbers missed his first shot and we was within feet of the intended recipient. He hit the robber with the second shot, striking him in the hip, but the first shot, from just feet away with no hostage was a miss. He had the whole body to shoot at, now just imagine trying to hit a moving target that is holding onto an innocent by stander...now tell me if you would still try to shoot.