This week’s MacWorld show was certainly a snoozer after last year’s launch of the iPhone, which was expected. The most interesting wireless news out of Steve Jobs’ speech was the use of Wi-Fi location with the iPhone.

The iPhone will use technology from Skyhook Wireless to provide location information via the Wi-Fi radio in the phone, as well as the Wi-Fi-enabled iPod Touch. Skyhook has mapped 23 million Wi-Fi access points, mostly in the United States and Canada, and uses that information to provide location information to devices running its software. The company says its database covers 70% of the United States and Canada, the top European cities and is expanding coverage in Asia.

Using Wi-Fi for location has one advantage over GPS – the ability to locate devices indoors. IMS Research points out that GPS is more accurate, although in dense urban environments Wi-Fi might be better. The limit to Wi-Fi location is that there have to be an adequate number of access points because Wi-Fi has limited range. IMS analyst Patrick Connolly says GPS and Wi-Fi can be complementary, if the handsets have both technologies.