Well I have had a chance to play with Picnik a little more. I am finding that its ability to edit photos is nice but there are more uses than that. By editing a photo our students can re-size them to smaller images and crop out unnecessary details. This will make some student projects smaller in size when they create there PowerPoints with too many graphics. I thought about this when I was cleaning out my hard drive of some old student projects with extremely large files built in.
If Picnik isn't for you or if its blocked you can always try LunaPic or Splashup.
6 years ago