No, it is just saying that there is no "basic communication" with the chip. Before any flashing, the USBtiny or any ISP through AVRDUDE does a chip check. The 0x000000 means no reply. Does the Uno board power up when you connect the USBtiny? Try this to test the USBtiny. Switch the ISP header to the '328 and send:
avrdude -p m328p -P usb -c usbtiny -V
It will not do anything other than try to talk to the chip.