Responding to the furious backlash of its customers, Apple has promptly addressed the controversial tracking function of its mobile devices with a software update: iOS version 4.3.3 for the GSM iPhone 4, 3GS, iPads and the fourth-generation iPod touch, as well as iOS 4.2.8 for the CDMA iPhone 4. The update was released exactly one week after the company said it would take a "few weeks." Although Apple hasn't completely eliminated the feature, its functionality has been trimmed down.
The release notes say that iOS 4.3.3 shrinks the size of the location database cache – we aren't sure by how much, but Apple previously said it doesn't believe the iPhone needs to store more than seven days of data. By comparison, some users reported that their device had logged a year's worth of location data. Additionally, that information will no longer be backed up via iTunes when you connect your device to a computer and the cache will be deleted when you disable Location Services.
Apple officially wrote some of the issues off as bugs, saying that the cache shouldn't have been as large as it was and your iPhone shouldn't have been able to update that data with Location Services disabled. Location information your device relays back to the company is anonymous and encrypted, and it's being used to build a database to provide iPhone users with improved traffic services. A future update will encrypt the cache on your device to ensure a third party can't use it for malicious purposes.
The topic exploded late last month when two researchers discovered that Apple's mobile devices stored location information to the "consolidated.db" file. That spawned lawsuits, worldwide government investigations and a scheduled congressional hearing on mobile privacy involving both Apple and Google. The search giant's Android OS also records such information. However, the database is limited to a smaller list of entries than iOS (prior to 4.3.3 anyway), and it's regularly wiped by the system.