Google  Goggles is an Android app that's part augmented reality, part scanner. Use it to take a picture of a product in a store, a barcode, album art, or lots of other things, and it'll look it up and offer links to shopping sites, Wikipedia, and Google Search results. It's very cool, even if sometimes the total incompetence of my Droid's camera makes it tough for Goggles to know what I'm pointing at. But Google just added  a huge new feature to Goggles--on the fly translation.
This is a potentially amazing feature, one I've never seen before in any app. Take a picture of anything with non-English text on it and Goggles will offer a translation. If you're in a foreign country (or, for non-Spanish-speakers, most of America), you can just whip out your phone, take a picture of a street sign, menu, or ransom note you don't understand, and let Goggles translate it for you.
I tried it out with some French things I had lying around my apartment, and ran into some problems. It interpreted "L'éléphant est amoureux du millimètre" as, no lie, "féfégmnt est an Qufqwi Ju millimii," which apparently translates to "féfégmnt year is the Qufqwi millimii" (useful!). That was the worst translation Google fed me, though even the best ones had the typical Google Translate hiccoughs (it doesn't use context--when "tremblement" sits next to "Haiti," Google still translates it word for word as "tremor" rather than "earthquake"). It's not perfect, though I'm hesitant to say that it's universal--the Droid's camera really is lousy, and it's the only Android phone I have lying around. A better sensor and software as seen in HTC 's Incredible might make a world of difference. And really, even when it did a terrible job, it still managed to give me a general idea of what was written in that scary accented moon language.
If Google can iron out the kinks, this is a killer feature that sets it apart from its competitors. Google Goggles is available in the Android Market for all devices running Android 1.6 or higher (meaning, almost all of them). I'm willing to overlook that whole "féfégmnt" weirdness if it's just the first step to honest-to-goodness on-the-fly translation.