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This is quite a long winded question, you can just skip to the last sentence if you don't care about the background info.

I just tested out HTML5 geolocation using Firefox 3.5+, and it managed to find my house, literally my exact address. I've been reading about how it works but can't find any detailed information, it says it collects information about local access points and then forwards this information to google.

I checked this out by testing it out on my wired PC, and it wasn't even close. So it definitely uses wireless. I checked out another service called skyhook which works similarly, and their 'How it works' page says they have a database with thousands of wireless points stored, so when you connect it simply looks up wireless points around you.

Sounds like a perfect secondary job for the google street view van, though everywhere I've read I can't figure out if google use the same technique.

I'm wondering how Google's geolocation works, whether they also store a huge database of wireless AP points, or if there are other methods that can do this.

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up vote 5 down vote accepted

whether they also store a huge database of wireless AP points,

Well, that's one way of how it works, according to their blog:

Google Maps asks your web browser for your location. Typically, your browser uses information about the Wi-Fi access points around you to estimate your location. If no Wi-Fi access points are in range, or your computer doesn't have Wi-Fi, it may resort to using your computer's IP address to get an approximate location. As you'd expect, the accuracy of My Location varies with your location, and in some cases, Google Maps may not be able to provide a location at all.

W3C Geolocation API, however mentions

The Geolocation API defines a high-level interface to location information associated only with the device hosting the implementation, such as latitude and longitude. The API itself is agnostic of the underlying location information sources. Common sources of location information include Global Positioning System (GPS) and location inferred from network signals such as IP address, RFID, WiFi and Bluetooth MAC addresses, and GSM/CDMA cell IDs, as well as user input. No guarantee is given that the API returns the device's actual location.

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Thanks, the google link is exactly what I needed. Not sure how I managed not to find this with a google search. Thanks. –  Dave Dec 2 '09 at 17:43
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Some info: http://www.mozilla.com/en-US/firefox/geolocation/

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-1. informative-but-not-really-answers should be posted as comments. fascinating link, but what does this have to do with the question (which is about how Google's geolocation works)? –  quack quixote Dec 2 '09 at 11:03
    
It does provide relevant information. I didn't expect this to be the best answer. –  alfplayer Dec 2 '09 at 16:27
    
Thanks, I already read this, it's how I discovered the information about wireless in the first place. But it's not what I was looking for in my question. –  Dave Dec 2 '09 at 17:37
    
Whilst this may theoretically answer the question, it would be preferable to include the essential parts of the answer here, and provide the link for reference. –  soandos Jul 16 '12 at 4:07
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