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Conversation Mode has arrived. Conversation Mode is a user interface for mobile devices designed to facilitate a real-time conversation between two people speaking different languages.

"Google Translate will translate your speech and read the translation out loud. Your conversation partner can then respond in [his or her] language, and you'll hear the translation spoken back to you."

There are some limitations. The current version supports only English-Spanish translation in Conversation Mode. And rapid speech or a regional accent may be misinterpreted by Google's systems. But these are problems Google is working to overcome.