Rumor has it that the next iPhone will eschew Google's Maps backend in favor of Apple's own. Rene over at iMore, who has a good handle on how the minds in Cupertino operate, has a great overview of Apple's supposed current strategy that you really should read to try to make sense out of this one. The short version -- Apple wants to shed Google's services. Not because users have a problem using them, but because they don't want Google to profit. Instead of offering an additional choice with their own version of a maps app, they are just going to replace what users know and love with something that generates less profit for Google. Smart business move, but a pretty foul dump on the users.
They're going to need some real magic to pull this one off. In the current version, Apple builds the UI and Google provides the mapping data. Google is really good at mapping stuff. The rumored version-in-waiting is supposed to add a 3D view, becoming the new killer feature for the next version of iOS. The problem is, users don't care about 3D map view (or anything 3D on their mobile devices) -- they care about features, ease-of-use, and integration. Apple can certainly take care of the integration part, and even give it some of that good old fashioned Apple magic in the UI department. But that still isn't going to cut it. Google has the one big thing™ when it comes to maps and navigation -- search data.
When you tap the button and tell your phone to find 1313 Mockingbird Lane, there's this unfathomably huge pool of data Google has at it's disposal to populate that map. Need to know where the closest Starbucks is? Ask Siri, or just look at the Google Maps app. Apple can't replicate this without years of its own data. Users will be left with an app with a pretty front-end, that's actually a step backwards in functionality. Apple will either have to offer a sub-par maps experience, or use Google anyway. And the first person who says Bing has to stay late and clean the chalkboard. That's two steps backwards.
Google creates the web services people want and use -- even people with iPhones. This is a space where Apple is going to find it's difficult to compete, and fickle users may just look elsewhere. Of course, you'll find just as many bloggers telling tales of how great this is, and that Apple invented Maps. It's going to be interesting to watch this one play out.