This is an especially important development (ahem) for the growing number of devices, from Wi-Fi enabled cameras and memory cards to mobile phones and beyond, that can send photos directly to Flickr without a computer intermediary. Until now in those cases, you could only use what limited retouching and editing capabilities were built into your device—if any—before your photos went online.
Now you can use an elegant and very Flickriffic interface to make lots of changes to your pictures (modify exposure and colours, remove red-eye, crop, etc.) from anywhere with any web browser, after you've posted them. Free.
Very slick. Picnik also offers Picnik Premium for $25 a year (the same cost as a Flickr Pro account), if you want more effects and editing capabilities. The free and premium services also work with other photo sites, by the way—today just adds an Edit Photo button right within Flickr.