Seagate has been keeping busy these days, it seems. Having just released the first third generation SATA drive recently, it seems that for one of their next tricks, they will be releasing hard drives that encrypt themselves.
Starting off with drives targeted at the server market, the new Cheetah, Savvio, and Constellation line of hard drives will encrypt any data going on to the platters, then decrypt it while being read. As hard drives targeted for servers, the drives are meant to be running all the time -- so if the hard disks are removed, by some mischievous punks, data will remain encrypted. Presumably the hard drives will only be able to decrypt the data if they are re-connected to the server they call home (so you couldn't take out a drive for instance, and use it with a different system -- the drives would recognize the change.)
These new drives will probably be of greatest interest to companies that deal with somewhat sensitive information, such as financial institutions, weapon manufacturers, K.F.C, and companies performing research.
Self encrypting drives probably will not enter the mainstream for consumers, as accidental data loss, and lower performance, would probably be two fears that would lead many regular Joes more interested in just using software-based encryption methods, like TrueCrypt.