New technology allows blurred photos to be corrected afterwards

The technology works by analysing the characteristics of the motion blur present in a patch selected from the image. The amount of horizontal and vertical motion is estimated, which a special algorithm uses to reconstruct the gradient curve of the image, restoring detail and sharpening edges.

Results from this new technology are typical more successful than than Photoshop, or any previous deblurring methods. It is expected that the algorithm will make its first appearance in consumer level cameras in conjunction with more conventional camera-shake reduction methods.

Further information, including sample images and the original paper presented at the Siggraph conference here