http://www.iclarified.com/entry/index.php?enid=1250

But whether it’s a new 2G model or a super-fast 3G, there is one thing
that’s for sure: The new iPhone has Global Positioning System (GPS)
built into it, thanks to legal requirements put in place by the FCC.
The company supplying the GPS to iPhone is going to be a big winner in
this space; the contract has been nailed down by Broadcom, a
relatively new entrant into the GPS market.

A recent report in Popular Mechanics outlines some of Apple’s GPS
moves. Last year, Google’s Marissa Meyer told us that the Google Maps
usage from iPhone was off the charts. Now imagine that Maps feature
married to the built-in GPS; the combo could give location based
services a big massive boost.

Above comment from Gigacom

Personally I love and use LBS every day on my iPhone. Even at the
house it is faster than digging out the phone book yellow pages when
something is needed. Today I was pondering that running a yellow page
ad is not a particularly good investment any more. A web site with a
heavy localized set of keywords and information would be more
effective in reaching new and existing customers

4phun.