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In this video tutorial, the presenter demonstrates how to annotate images using an online tool called Good Annotations. Image annotations are useful for labeling and pointing out elements in images. To access Good Annotations, search for it on Google and click on the first link. Once on the website, navigate to the image tools section and click on the image annotation link provided in the description. Upload an image to annotate, such as a street view picture of London Westminster, to begin annotating.