A workaround that got me past this problem:

0. Boot into a live session
1. Open a terminal
2. sudo -s
3. lsmod   and look for the camera driver (mine was uvcvideo)
4. rmmod uvcvideo
5. Add a blacklist file for uvcvideo to /etc/modprobe.d/
6. Start the installation

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https://bugs.launchpad.net/bugs/875297

Title:
  Ubuntu installer hangs on "Choose a picture" screen. Never recovers.
  Installation not bootable.

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