According to Jim Irsay's informative Twitter account, the Colts have signed veteran cornerback Justin King, who started 12 games for St. Louis last season. The Colts were rumored to be looking at King a few weeks ago, but nothing came out of it until today.
King was Pro Football Focus' worst graded cornerback last season, with a negative 22.6 grade. Yes, worse than Jacob Lacey, worse than Kevin Thomas, and worse than Chris Rucker (although I would still argue that Lacey is merely an average to slightly below average corner).
However, King was not meant to be starting. He is a decent slot cornerback, where he was supposed to play. Unfortunately, injuries forced him to start, much like Lacey was forced into a starting role he didn't deserve to be in in 2010. When he had more of a third corner role in 2010, he came out with an average grade of +0.4 for the season. Even last year, he had a terrible first half of the season, and then settled down in the second half.
King has his strengths, one of which is run stops as a cornerback (a primary function of slot corners). According to PFF, he was the 7th rated cornerback in run stops. King also has elite speed, running a 4.31 forty in 2008.
King isn't the answer to the Colts' question at cornerback #2, but he does bring more experience to the group, and will compete for that second or third spot.
The question now is who gets cut? Between King, Cassius Vaughn, Kevin Thomas, Chris Rucker, and Terrence Johnson, the Colts have a lot of young unproven talent, and likely will cut at least one of the five. With work they've done in OTAs, I would guess that Rucker or Vaughn has the greatest chance at getting cut at this point. However, it could realistically be any of the five, and I wouldn't bat an eye.