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In this video tutorial, the speaker demonstrates how to annotate an image using an online tool called Good Annotations. Image annotations are useful for labeling, pointing out details, or showing something to someone. To start, search for Good Annotations on Google, click on the first link, then go to tools and select image tools for image annotation. Upload an image, such as a street view picture of London Westminster, and start annotating. The speaker provides a link in the description for easy access to the annotation tool.