Exactly. For the life of me I can't understand why so many companies don't get that it's better to lay all your cards on the table when this stuff happens than to hem and haw and obfuscate. If El Steve-o had just come out right away and said "we're collecting stuff, it's not very detailed, we'll put in a mechanism to turn it off without losing any location-aware functionality," this could have blown over before senators started getting involved.
But they did, last summer (2010), due to a general congressional inquiry about location tracking regarding all smart phones. And even prior to that inquiry, there was information about what Apple was doing, from the EULA, to WWDC sessions and information readily available on the developer site.
There was nothing new discovered with this current issue, beyond bug related problems. The existence of the cache was known (directly from Apple), the fact it was backed up was known (from forensics experts last year and is now known to be a bug), and the fact that it doesn't contain the exact location of the phone. The only thing new about the report from O'Reilly Media was the hype, and an application to incorrectly map the data.
According to Apple, none of this information is sent from the iPhone TO Apple, and in fact it's downloaded FROM Apple to the iPhone. Which does make sense
It makes no sense at all -- or at best is a misleading half-truth. The information they're talking about ("all the cell towers in Toronto") is sent from Apple to Iphone. Why is
that particular slice of the global database sent? Because the Iphone has sent to Apple a request saying, "send me all the cell towers near <this specific location>". Apple still gets told your whereabouts.
Bruno's statement should probably be clarified. Apple stated the cached file is never sent to Apple. That's what they mean. Last summer, they already acknowledged they receive data from users based on location requests. And they explained that under iOS 3.0, Google and Skyhook also received the requests, but as of iOS 4, only Apple sees it.
As far as the data Apple gets for this exact location issue, they see a request not that a phone is at exact position X, but instead they receive data that says "I can see a cell tower with ID number 53022, and another with ID 53023, send me all cell tower data around those towers". All the triangulation involving power levels of the signals from each tower is done locally on the phone. With WiFi data, Apple receives requests that do narrow down the area a bit more, but these requests may also be based on where the user is searching, and not the location of the device. This is done for the iOS devices lacking cellular radios and GPS chips to still allow them to show a basic location marker.
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