Apple renews Google partnership, Google Maps still in iOS 5
According to Engadget, in an interview at the D9 Conference Google's Eric Schmidt confirmed that Apple and Google will maintain their partnership in maps and search functionality in iOS. "We just renewed our map and search agreements with Apple, and we hope those continue for a long time."
This may mean that Apple has put a hold on plans to institute its own mapping service, or that the service was never close to deployment to begin with. Whatever the case may be, it looks like Google Maps will be the default mapping service for iOS 5 at the very least, and possibly for some time to come.
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