Official Google Blog: A better way to organize photos?
I'm a big fan of Picasa. My favourite feature is the (slightly buggy at present) Geotagging integration with Google Earth.
The link is to an official Google blog post where they envisage a world where photographs are automatically tagged based on their contents. For example, all the photos on my hard disk which feature my parents will be automagically tagged appropriately. Google have, like all companies with that much money, bought a company with the technology to make this a reality. Awesome.