Following my initial write-up a few days ago about consumer adoption of location based services, I've been doing some further reading and thinking on the topic.
For location-based services to be truly attractive to consumers, there needs to be technology that can accurately pinpoint your location on the map. Accuracy needs are different for different applications, but in an urban environment at least a 2 city block accuracy range is necessary.
There's an article on Venturebeat today titled Three Deadly Sins of GPS that covers this issue of location tracking accuracy. It's written by the CEO of Polaris Wireless, a wireless location company. The last three paragraphs of the article are a plug for Polaris's technology, but the rest of the article is quite useful as a primer on the shortcomings of GPS on the positioning accuracy front.
One last observation on this topic: When Google Maps launched their location tracking feature (beta) a few months ago, I enthusiastically turned on GPS tracking on my handset and waited for results. More than six months later, it's still off by several blocks. The point is, Google Maps is using hybrid technology, not just GPS, to locate my handset. And it's still not accurate enough for a pedestrian.