Tags are really nothing more than keywords used to describe a piece of data be it a web page, a digital photo, or another type of digital document. Of course, organizing digital images by keywords and categories has been around for a long time, it just wasn't called "tagging" until fairly recently.
In my opinion, Adobe's visual metaphor of the tagging concept in Photoshop Album helped make the idea more accessible to the public. After all, a keyword or category is something abstract, but a tag is something tangible which you can visualize like a gift tag, or a price tag. In Adobe's software user interface, they showed a very literal representation of the act of tagging. Your keywords were literally displayed as "tags" and you could drag and drop these tags onto your pictures to "attach" them to the photo.
The Old Way: FoldersUntil recently, the folder concept was most commonly used as a way of grouping and organizing digital data, but the folder concept has its limitations. The most significant limitation of folders, especially for digital photo organization, is that an item can only be in a single folder at a time without duplicating that item.
For instance, if you have a digital photo of a sunset which was taken at Indian Rocks Beach, Florida on your 2006 vacation, you are faced with the dilemma of whether to put it in a folder for sunsets, a folder for beach photos, or a folder for your 2006 vacation. If you were to put it in all three folders it would certainly be a waste of disk space and create a lot of confusion trying to keep track of multiple copies of the same image. But if you only put the photo into a single folder, you have to decide which folder is the best fit, and this type of decision-making can hinder the organizational process.
The New Way: TaggingEnter tagging. With the concept of tagging, categorizing that sunset picture is much less of a dilemma you simply tag it with the words sunset, Indian Rocks Beach, 2006 vacation, and any other words which might be appropriate.
The true power of tags is revealed when it comes time to find your photos later. You no longer need to remember which folder you might have put something in. You only need to think of some aspect of the photo that you would have used in a tag. When you search on a tag, all the matching photos associated with that tag can be displayed.
Tags are especially useful for identifying the people in your photos. If you tag every picture with the names belonging every face in the photo, you'll be able to locate all your pictures of a particular person in an instant. You can also combine and exclude tags to further refine your search results. For example, a search for "Suzi" and "puppy" will display all photos of Suzi with a puppy. Exclude "birthday" from the same search query and you'll find all photos of Suzi with a puppy except for those tagged "birthday."
Tagging and Folders in Perfect HarmonyTagging does have some disadvantages as well. With no hierarchy, the use of tags can become unwieldy. There is also a temptation to create so many tags and such specific tags, that suddenly managing hundreds of tags becomes as much of a chore as managing the photos they're supposed to be helping you with! In the end, I think tags will be just one part of the solution to digital photo organization. Together with folders, captions, and ratings, they can be a very powerful tool.
Tagging represents a significant shift in the way digital data will be sorted, saved, searched, and shared in the 21st century. If you've been locked in to the old folder way of organizing digital photos, it's time to open your mind to the tagging concept. It doesn't mean the folder concept is going to go away, but I believe tagging is the way of the future and a valuable improvement to the hierarchical folder concept we've been using.