Apple has got many feed back against the location tracking method by apple , apple released Statements on it on 27th of april. Apple calls it a BUG which has done the fuzzy effect and a new update will be released to fix it.
The main points in the official statements
Apple has been tracing location information all the Iphone users via GSM and Wifi Hotspots, because apple uses all this information to speed up regular GPS location services for all users , it records the info from users where ever they go.
Apple also confirmed that the Location recording continues even after the location services has been switched off and the info will be stored ever since the phone was bought . According to the statements the bugs are newly discovered and will be fixed with the next software update. It will disable backing up the location database to your computer, and your iPhone will log your location for only about a week back in time. You will be able to turn the feature off altogether by disabling Location Services.
Apple also collects traffic data to provide better service in couple of years.
The conclusion Apple respects privacy and will continue to do that. A fix will solve all the problem
You can read the full statement and Q and A here
