If it was fully baked, you could think of Conversation Mode as the same as the Universal Translator on the original Star Trek. You speak a word or phrase, and Translate translates the words into an alternate language and reads it out loud. For now, Conversation Mode only works between English and Spanish, but the feature is only Alpha, after all.
As the feature is only alpha, Google adds that "factors like regional accents, background noise or rapid speech may make it difficult to understand what you’re saying." Even given that, this sounds pretty exciting, at least it will be when it reaches a release stage.
Google also made a few ease of use changes to the app. Meanwhile, it also noted that now, the majority of use of Google Translate occurs outside the U.S. Google said:
As Android devices have spread across the globe, we’ve seen Translate for Android used all over. The majority of our usage now comes from outside the United States, and we’ve seen daily usage from more than 150 countries, from Malaysia to Mexico to Mozambique. It’s really rewarding for us to see how this new platform is helping us break down language barriers the world over.You need Android 2.1 or later to install Google Translate, from the Android Market.
Translate supports 53 languages, from Afrikaans to Yiddish, and voice input for 15 languages.
Google demo'ed the feature a few months ago, but now it's giving Android users a chance to try it out. You can see the earlier demo in a video below, at about the 26:24 mark.