GPS stands for Global Positioning System. It is a satellite-based navigation system made up of a network of 24 to 36 satellites placed into orbit by the U.S. Department of Defense. GPS was originally intended for military applications, but in the 1980s, the government made the system available for civilian use. GPS works in any weather conditions, anywhere in the world, 24 hours a day.

Now you know GPS is FREE of Charge. You are interested to know what do you need to use GPS.

There are different type of GPS device/configuration.

Handheld Unit - The handheld units (these have smaller screens) are generally used by people who go hiking, mountain biking, tracking (to map new trails or roads). (This one is not suitable for us, continue reading below.)

Automotive Unit - The Automotive units are generally designed for car navigation. Some of these models come with Bluetooth and MP3 capability. All these units have an external storage card via SD card or equivalent. (I won’t  elaborate much on this, because we are in Handphone Section)

Mobile PDA Unit - The 3rd category are for those who prefers to use their PDA (whether be it the Windows Mobile platform, Palm OS platform or Symbian OS platform) for road navigation, phone and PDA functions. There are 2 different case: first is you can use the built in GPS receiver in the PDA or Smartphone or the second case is you buy a GPS receiver (GPSr) and pair with your PDA / Smartphone through Bluetooth. NOTE : Usually GPSr tends to receive faster signal and better signal than built-in GPS in PDA or Smartphone.

GPS service is FREE of Charge. There are no subscription fees or setup charges to use GPS. However, navigational software is not free. GPS receiver will only tell you where your location on Map is but if you want to go to a place with real time navigation, you need buy the full version of software so that it will guide you step by step to go to a place.

A-GPS stands for Assisted GPS.

Assisted GPS, generally abbreviated as A-GPS, enhances the startup performance of a GPS satellite-based positioning system. It is used extensively with GPS-capable cellular phones as its development was accelerated by the U.S. FCC's 911 mandate making the location of a cell phone available to emergency call dispatchers.

Conventional GPS has difficulty providing reliable positions in poor signal conditions. For example when surrounded by tall buildings (resulting in multipath), or when the satellite signals are weakened when a GPS device is indoors or under trees. Some newer receivers are better at handling these situations.

In addition, when first turned on in these conditions, some non-assisted GPS units may not be able to download the almanac and ephemeris information from the GPS satellites, rendering them unable to function until a clear signal can be received continuously for up to one minute.

An A-GPS receiver can address these problems in several ways, using an assistance server:

    * The assistance server can locate the phone roughly by which cell site it is connected to on the cellular network.
    * The assistance server has a good satellite signal, and lots of computation power, so it can compare fragmentary signals relayed to it by cell phones, with the satellite signal it receives directly, and then inform the cell phone or emergency services of the cell phone's position.
    * It can supply orbital data for the GPS satellites to the cell phone, enabling the cell phone to lock to the satellites when it otherwise could not, and autonomously calculate its position.
    * Simply capturing a brief snapshot of the GPS signal, with approximate time, for the server to later process into a position.[2]
    * By having accurate, surveyed coordinates for the cell site towers, it can have better knowledge of ionospheric conditions and other errors affecting the GPS signal than the cell phone alone, enabling more precise calculation of position. (See also Wide Area Augmentation System)

As an additional benefit, it can reduce both the amount of CPU and programming required for a GPS phone by offloading most of the work onto the assistance server. (This is not a large amount for a basic GPS – many early GPSs utilized Intel 80386-class 16MHz CPUs or similar hardware.)

A typical A-GPS-enabled cell phone will use an internet connection to contact the assistance server. Alternatively, it may use standard non-assisted GPS, which is slower and less accurate, but does not lead to network charges for data traffic, which can be considerable.[3] Some A-GPS solutions do not have the option of falling back to conventional GPS (as with the new iPhone 3G).

High Sensitivity GPS is an allied technology that addresses some of the same issues in a way that does not require additional infrastructure. However, unlike some forms of A-GPS, high sensitivity GPS cannot provide instant fixes when the phone has been off for some time.

Source Taken from Wikipedia and pasted here for easy reference : http://en.wikipedia.org/wiki/GPS_Phone

Yes, since you will be sending and receiving data from server, your TELCO will charge you based on the GPRS/EDGE/3G used.