The entire document list within Google Docs and Spreadsheets has been given a complete visual overhaul with “new icons, more content, and better organizational controls”. Searching documents in the service has been improved; dynamically filtered results from documents are listed as a user types.
Folders are the biggest change. Google has not abandoned tagging and yet the inclusion of folders would indicate that Google is finally listening to the millions of people who prefer folders in preference to tagging.
The question I do have is what about Gmail? Without hopefully causing a flurry of people telling me how wonderful tagging is, I’m one of those (perhaps crazy) people who download my email from Gmail into a desktop based email client, and I do so only due to the lack of folders in Gmail. Hopefully the inclusion of folders in Google Docs is a sign of future functionality in Gmail.