Google account owners who have enabled Google+ are able to upload a profile photo which is used across most Google products and services, but to those who haven't or don't want to upload their own photo will soon see their first or last initial in a coloured circle which should help users identify which account they're logged in.
The change is due to take effect this week, though users with initials using scripts other than Latin, Cyrillic, Greek, Chinese, Japanese, and Korean will see this change later this year, according to the Google Apps blog post.
I'm happy with this pending update, as we will no longer see an army of the anonymous looking blue heads scattered in our streams and suggested contacts. The initials add differentiation, and keeps things looking fresh.