So I knew that one of the features of the iPhone that I would enjoy the most would be the location services. The iPhone is really the first mobile phone out there that makes location such a central focus of the device and included with many of the native applications that ship with the phone. A lot of it has been talked about in the ubicomp research community for years and years, but it's finally all come out in one package.
Things I enjoy the most:
1) Google maps - click the location button and it zooms into your cell tower area, wait 10 seconds more, and it's pinpointed you on the map. Get directions and click the location button again, and the little dot follows you along your route. Simple, beautiful.
2) Geotagging of photos - take a picture, allow access to location, get a picture with lat,long in the exif headers! So wonderful!
3) Yelp - a 3rd party app, get lists of nearby restaurants, bars, coffee shops, etc. with one touch. Automatically gets your location and creates the list, complete with reviews from yelp.com.
4) Weather - the weatherbug app can center on your location and get you forecasts and live radar for wherever you are.
The mobile phone is not just another computer. It's a device for information and social access *in* the world. Which means location is often a large part of what you're experiencing. From getting places, sharing photos from those places, finding more about the place where you are, and making sure you stay dry this is just the tip of the iceburg for location access on mobile devices. All of this is possible because location is such a core part of the platform. Any application can get it with just a simple call. (another app that I didn't mention because I don't have it installed yet is loopt which lets you see where your friends are - very useful for microcoordination tasks in meeting up).