In this case, I'm referring to Word Lens, a free iPhone app that combines machine text translation with augmented reality [iTunes link]. Point your iPhone at a sign in a foreign language, and Word Lens uses the iPhone's camera to show you the sign... except the foreign words are instantly replaced with their equivalent in English. It's like holding a practical, realistic version of Star Trek's Universal Translator in your hands.
Do I have your attention? Good. So that's the concept; let's talk real-world implementation.
First of all, it really does pretty much do what I described. I can hold my iPhone up to almost any sort of sign and the app does its magic immediately. It doesn't work with handwritten text or anything with script or fancy fonts. And right now, it can only translate English to Spanish and Spanish to English. And each language pack costs $5 each, so it costs $10 to go in both directions. As I mentioned, the app is free. To let you play with it without making a language pack purchase, it has two demo modes: You can command Word Lens to reverse or even erase any text it sees. When I showed it off to my writing team at work the other day, they couldn't believe what they were seeing. And someone pointed out that the backwards text actually is a language pack. It's English to Demon.
The quality of the translation is about what you'd expect; clumsy and inelegant. But plenty good enough to give you the gist of whatever you've pointed your phone at. But you're not going to use Word Lens to read a novel; you will use it to read street signs, find out if there are sharks in the water at the beach, and suss out a restaurant menu. On those counts (though menus will definitely be hit or miss) it is perfect.
See it in action in this video: