yep.

Isn't it also federal law, all new cell phones must have GPS?

Actually, no.

The FCC requires, by a certain date, for all wireless carriers in the US
to be able to identify and report a customer's location with an accuracy
of around 100 meters or so when they dial 911.  But this DOESN'T mean
that GPS must be used to make that a reality.  In fact, GSM carriers in
the US are trying a system where they don't have to install GPS or any
other sort of additional hardware on their user's handsets.  Instead,
they're using a system to triangulate the location of the cell phone
using cell towers (whose locations are always known, with or without
GPS).  The advantage is that none of the end users need to upgrade their
handsets to take advantage of this new system.

The CDMA carriers in the US, and Nextel, decided instead that it would
be easier to use a GPS-like device installed on new handsets, rather
than try and triangulate a position at the towers.  This requires people
to upgrade their phones, but most people do this in about 18-24 months
anyway.  Also, this gives the added feature that the end user can make
use of the GPS functions on their phone for non-emergency related
purposes, like getting driving directions and the like.

It turns out Nextel and the CDMA carriers were right: the GPS-based
system works really well and can be deployed very easily, while the GSM
operators are having a little bit of trouble getting their system to
work right all the time, in all locations.  Triangulation isn't
impossible, just a little harder than they anticipated.