(via Google Blogoscoped)
The spin here is that it tags the news by type (the categories in Google News). You can also read the news in a non-mapped form by selecting a category. I've not looked in too much depth at the accuracy of the geocoding (this often gets missed by the blinding eye-candy effect of this type of visualization). However, a first look at the World results showed a number of errors including the association with Berlin of this article:
BAGHDAD A Christian peace group said Wednesday that the policies of the US and British governments were ultimately to blame for the kidnapping of four of its members over the weekend, among the latest in a new wave of abductions of Westerners.
which links via there site to a completely different IHT article, as well as a number of others whose only connection with Berlin is:
Associated Press reporters David Rising in Berlin, Michael Tarm in Chicago and Rob Gillies in Toronto contributed to this report.
Geocoding really is in the details.
Update: The mislinked article appears to be a problem of IHT's - it has the same title linked to the wrong article on its own pages. One of the kidnapping victims does appear to be German:
Susanne Osthoff, 43, of Germany. Disappeared Nov. 25. On a video made public Nov. 29, kidnappers threatened to kill her unless Germany stops dealing with the Iraqi government. An archaeologist who speaks Arabic, Osthoff works for a German company that helps distribute aid in Iraq.
However, the article is clearly about Iraq, not Berlin - or if it is about Berlin, it is also about the capitals of the other nationals kidnapped as well.