You must see this demo of a prototype Android app that Google previewed at Mobile World Congress. It’s just the logical next step for Google Goggles and Google Translate. Instead of automatically (and imperfectly) identifying a picture taken of a book/logo/landmark, the app lets you capture and translate written text. All the hard work of OCR’ing and translation is done in the Google cloud.
Fast forward to 1:16 to see the app translate a German menu: