Michael Arrington at Techcrunch reported that Yahoo is announcing fireeagle, which is a new service for obtaining geo-location information, storing it, and making it available to other web applications. This is a technology coming out of Yahoo Brickhouse, a semi-autonomous Yahoo group focused on new product development.
Evidently, the whole system is permission based, which means that users can choose to share their location information, or choose not to. This includes giving users the ability to eliminate any stored information about their locations over time from Yahoo's servers. This should keep the "big brother" concerns to a minimum.
One of the most intriguing aspects of this is that the geo-location information can come from any number of sources, such as other applications, and from GPS devices. You can setup a GPS phone to periodically update your locations information automatically.
The Techcrunch post provides the example of users who make submissions to Flickr who frequently don't provide any geo-location information for the photos submit. With fireeagle enables, this information could be extracted automatically.
Of course, search engines have been using location based information for a long time. They have the ability to look at the IP address of a person who is entering a search query, and then do a reverse lookup to determine the approximate location of that person. Geo-location information from a GPS device, however, would be much more accurate.
IP address based geo lookup is very general in nature, and in some scenarios can be completely wrong. For example, AOL users may have an IP address that changes mid-session. In other cases, someone working in a company office in LA may connect through their corporate network based in Chicago. There are many other example of these types of errors.
From a search perspective, improved location information can improve the location based personalization that search engines have already engaged in for some time. As an example of this, if you are sitting in Seattle, and type in "Italian restaurant", there is a good chance that you really mean "Seattle Italian restaurants".
However, if you just a few miles outside of Seattle, and type in "Italian restaurant", traditional IP based geo lookup might still give you a list of restaurants in Seattle, where what you may really want is a list of restaurants closer to where you are.