The other major new piece of hardware in the iPhone 3G is a GPS (Global Positioning System) receiver. The iPhone 3G uses Assisted GPS, which essentially means that the phone's search for GPS information is assisted by computers at cell-phone towers, improving speed and reliability. (And if the iPhone 3G can't get a GPS fix, it can use Wi-Fi and cell tower information to guess its position, just as the first-generation iPhone could.)

Several included applications on the iPhone take advantage of GPS, and numerous third-party programs do as well. The built in Maps application uses GPS to track your current location, represented by a pulsating blue dot at the center of the map. The performance of the GPS totally depends on the strength of the GPS signal. The iPhone's camera also uses GPS to embed the exact latitude and longitude of every picture you take (though you can turn this feature off), a process known as geo-tagging.

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The feature generally worked as advertised, though there was a strange bug: copying a geo-tagged image out of iPhoto and into the Finder corrupted the embedded data and made Flickr (a photo sharing Web site that sup¬ports geo-tagging) show a bizarre location sometimes. Of course, the killer application for a GPS-enabled cell phone is probably turn-by turn driving directions. The included Maps application will show you where you are in the context of driving directions, but unlike dedicated GPS devices.