It has taken a while but it could be expected that Picasa would at some point become a platform to publish your photos to the web. The basic picasa account provides 250MB so far. It is all still very Beta in that some features you would expect are missing (see below), but it means that I do not require my Picasa XML -> decent XML xsl file and Ajax'ed gallery page anymore, but can merely link to Google's version.
So far the thing says "test" and indeed I am unable to find anyone else's photos and it is also not possible to classify images apart from having them in albums. Therefore it is certainly no match for Flickr. The only advantage so far is the existence of a nice client to upload pics as well as no need to open up a Yahoo account with all the caboodle you would be exposed to then.