Recently, some rumours of a future GPS chip placed inside the iPhone have spread along the Web. Whether true or false, any user who would like to have this feature will have to wait until may 2008 (when the 3G upgrade is supposed to be).
Unless you download and start using the new Navizon virtual GPS navigator which is now available for iPhone too (it is also available for BlackBerry, Symbian, Windows Mobile and Java).
The application is designed to use the WiFi hotspots and phone towers of its sorroundings to triangulate your location (with an estimated error or 70 – 100 meters) and paint it using Google Maps. The system also uses data gathered from other Navizon users who have regular GPS devices.
Navizon has a trial period of two weeks but after it you have to pay 25$ for a time unlimited licence.
More info at Navizon website