Now that Google Maps has made its way over to the iPod touch, the introduction a new feature called My Location has been introduced. Previously this feature was restricted to devices like the iPhone on a cellular network devices using cell antenna triangulation to determine location. With no cellular hardware in the iPod touch, how would My Location work? Enter SkyHook. Have you heard of SkyHook? SkyHook has gone to the streets of the US with vehicles similar to Google street view cars and instead of capturing images, captured wireless network information and precise geographic information about those networks.
To pinpoint location, WPS uses a massive reference network comprised of the known locations of over 23 million Wi-Fi access points. To develop this database, Skyhook has deployed specialized vehicles to survey every single street, highway, and alley in 2500 US cities, scanning for Wi-Fi access points and plotting their precise geographic locations. Source
SkyHook even has a Google Maps plug-in that will show you what areas have been scanned and are in the database. And yes, it works. Eerily well.