Many of the current implementations of AR involve searching for points of interest, but this is not exploiting AR to its full extent. The best use of AR is to overlay virtual information on to the physical world. AR can then be used to enrich what we see based on our location. A simple example of this is shown by the layar team:
Here is another example where grafitti and street art can be located, extra information can be viewed as well as conversations with other users: streetARt.
Another use for AR is gaming, here are some examples of games; Virus killer and Falcon Gunner:
There are many potential applications for AR, for example you could have restaurant menus displayed when looking through the camera of your phone, to save you crossing the road or going into the restaurant. This exciting technology is still in its infancy and it will be interesting to see what new and innovative uses can be made of it.