So, instead of just analyzing keywords and matching strings of characters with their index to return search results that are likely relevant to your keywords, Google will now put your keywords into a context, allowing it to understand the thing your looking for in the real world.
Google's "Knowledge Graph" is drawing on many sources of information to understand things in the real world as "objects" rather than strings of data. It's also starting to piece together relationships between objects.
Now let's think about this for a second. It's 2012. Google uses massive computing power to accomplish the feats described above. Given that the power of this technology roughly doubles every 12 to 18 months, how "smart" will Google's search engine be by 2020?
How long before it understands itself, and it's relationship to us?
What else is coming, (soon), that most of us aren't even remotely aware of?