Yes, they need to have a Zooomr account. Anyone one can see public photos, but only those Zooomr members you designate as "Friend" or "Family" can see photos that are private and set to "Friends" and "Family".
I do use the feature, and it works quite well. If you don't want all your friends or family to have to sign-up for Zooomr you can create a "polettix_family" account and give everyone in your family that password. Then they can view your photos that are private.

There has been talk of some people using the API to allow friends or family to view private photos. I'm toying with it, but haven't had time to really work on it.

yes, i you f/f function, it works well.

Question ? How do I set a contact as a Friend or a member of My Family ?

Thx

I was wondering exactly this: how can someone be designated to be part of my friends/family list? Please note that I'm not PRO, so there could be some differences between our accounts.

@Gary H: isn't creating a shared account a violation of the terms of service? There's an explicit point to this regard:

[...] you agree not to use the Service or the Site to [...] register for more than one User account, register for a User account on behalf of an individual other than yourself, or register for a User account on behalf of any group or entity;