Google&39's Goggles app can identify objects.

Update at 12:30 p.m. PT: Google claims CNN's story to be speculative. A company representative said "we are in fact not working on developing an app with these capabilities."

Update at 4:30 p.m. PT: CNN is now countering Google's claims, saying it stands by the original piece. An updated version of our story follows.

Google says it's not working on an application that would allow users to identify others by snapping a picture of their face with a cell phone camera, despite a high-profile report that one is on the way.

A report posted by CNN earlier today claimed the company is at work on such an application, but faces privacy hurdles in readying it for market. The story contained an interview with Google's engineering director for image recognition development, Harmut Neven.

In a statement earlier this afternoon a representative for Google said, "we are in fact not working on developing an app with these capabilities," and referred to the piece as speculative. Now CNN is fighting Google on the issue, claiming that the company's claims "do not fit the facts of the situation."

"This interview was prearranged--on the record--and staffed by a Google PR rep, who raised no objections at the time and did not deny what the engineer said," a CNN representative told CNET. "Additionally, we have an audio recording of the interview, as does Google. We stand firmly behind Mark's reporting."

A Google representative declined to comment on CNN's statement.

Privacy remains a touchy subject for Google. Earlier this week Google entered a settlement agreement with the Federal Trade Commission over last year's launch of its Buzz service, which has led to the company agreeing to establish a "comprehensive privacy program." In terms of imaging, Google had also gotten in hot water with privacy groups when it rolled out its Street View technology, which provided raw photos with faces and license plates, two details that were later removed.

As for the validity of this idea, Google already provides an image-recognition tool called Goggles, which is available both on the company's Android mobile OS, as well as on Apple's iOS. It can grab text, and identify products, landmarks, works of art, book covers, bar codes, all of which can be searched for on Google. The company has also tied the feature to its translation service to let users read captured text that's in a foreign language.

Google has also long been involved with facial-recognition efforts, building the technology into both the software and Web-based versions of its Picasa photo platform. When toggled by users, it can go through a library of photos and identify people who show up in multiple photos. On the Web version of the software, this is handled entirely through Google's servers.

Whether it's coming soon or not at all, who wants an app like this