Not much more to it than that really – The Big G has added paid search listings to the image search results. From what I can tell, they’ve not targeted just consumables/retail product searches (which you’d see in the results) but all terms.
It seems a natural extension for Adwords – monetising traffic which probably has a high propensity to leak out of the Google experience. Here’s an example of the Google paid listings in an image search result – in case you can’t be bothered to try it for yourself:

