When governments pass asinine laws like "Nobody can take photos in public except us," there are consequences. Maybe the citizens of Austria will think about why they don't have Street View coverage during the next election.
There was no law passed in this setting, but a temporary ban specifically targeted at the Street view cars <http://www.google.com/hostednews/afp/article/ALeqM5gqQOUMhV0... in the wake of the discovery that they were collecting private wireless data, in order to investigate.
I do not live in Austria, but, in my opinion, this does not seem an entirely unreasonable reaction to that discovery. (Incidentally, I think I would be in favor of laws controlling the massive untargeted acquisition of information in public space, for privacy reasons... and I would not mind at all if this meant there was no Street view coverage in my country; quite the contrary.)
No, the principle is that you can have overreaching privacy protections or convenient geolocation features, but not both.
(That said, a3_nm's post indicates that this case had more to do with Google's collection of private data over WiFi than the photographs themselves. It's hypocritical for governments in the age of Snowden to criticize a private company for doing that, but at least it's understandable.)