Well this is NOT the source but this is what they call AT&T NAVIGATOR (GPS) which is a 30 day trial - if this turns out to be true, wow, there will be FOUL cried every where.
http://www.wireless.att.com/businesscenter/popup/telenav-gps-important-info.jsp
Also, not sure how they are doing it but TOM TOM is releasing a software package for iphone 1 so it will somehow be better than what apple presently has.
If true, then I think Apple would be smart to re-release the FIRST iPhone at any price, maybe $299 as some would save even if they broke (jail) and used TOM TOM GPS, only thing they won't get is 3G which each day looks less appealing considering almost all of us are near a data system (WI FI) and can deal with EDGE, especially if over the long run it is going to save a lot of money and no contracts.