Next-generation iPhones likely to focus on internal improvements.
iPhone 4 with Improved GPS Accuracy and Speed over 3GS
One of the hidden benefits of the 3G iPad was improved GPS accuracy and speed over the iPhone 3GS. The improvement was attributed to a newer GPS chip from Broadcom. iFixit's teardown revealed that the iPhone 4 shares the same Broadcom BCM4750 chip as the iPad, suggesting the iPhone 4 will see the same benefits.
At least one reader experience confirms the improved GPS accuracy and speed of the iPhone 4:
I used my Navigon GPS app today for about ten minutes, nothing to long or in depth, but the [iPhone 4] got a lock in seconds and was spot on. I'll test it tonight going home from work and see how it does but I didn't notice any issues earlier today, in fact it was a huge leap from the 3GS in terms of reliability and accuracy.