Augmented reality has been the main buzz in the Flash community of late with the recent release of the FLARToolKit. Augmented reality blends real world objects with computer-generated objects.
Bartek Drozdz gives a basic description of augmented reality on his blog:
Augmented Reality uses pattern recognition to render 3D graphics on top of a video display. A pattern, also called marker, is a rectangular shape that you need to print and position in front of your camera. The stream from the camera is analyzed and the marker is used to determine the coordinate system of the world captured by the camera. This coordinate system is passed to a 3D engine which renders objects on top of the video image.
Duane Nickull highlights the FLARToolKit on his blog:
FLARToolKit is an AS3 version of ARToolKit. ARToolKit was a C library that enabled augmented reality; however the Adobe Flash/Flex/AIR compatible version, FLARToolKit, is not merely a port of the original C version. FLARToolKit is ported from a Java, version which is called NyARToolKit. (NyARToolKit seems to execute much faster than the original C version after the great effort of nyatla.)
The ability to build browser-based applications that include the power of augmented reality should introduce new ways for developers to think about software. To help developers get started, Adobe evangelist Lee Brimelow has a video tutorial, which also includes a demonstration of GE's Smart Grid Augmented Reality application. The GE application offers an excellent example of using the wow factor of augmented Reality in a real world application.
For more background on Augmented Reality check out the Wikipedia entry.