you're missing one detail
it wouldn't be new if it just knew your CURRENT location...
But what they've found is that the iPhone LOGs the data of where you are, until it's where you've BEEN... it's stored in a file on the phone.
The Michigan police would love this- they've got a log file they can read on your phone that tells them where you've been recently... [Coffee]
I haven't heard how long it tracks this data for, since I don't own an iPhone, and don't plan to I haven't bothered to research it very far.
I WAS an Apple supporter back in 1981, until about 1988... I even did desktop support on them around 1994, but didn't buy any of their products..