Steve Jobs announced the new iPhone 3G and it overcomes most of the objections to the first model:

•$199 price point for the 8 gbyte model
•3G connectivity where AT&T has coverage (most major markets with expansion planned but not in Olean until sometime in 2009)
•GPS capability
•Lots of cool cheap and free software including games, IM and some interesting social networking

Clearly a successful iPhone leads to greater Local Search. According to the reports from the talk Jobs noted:

98% of iPhone users are mobile browsing; 94% are using email; 90% are text messaging; 80% are using 10 features or more. “You can’t even find 10 features on other phones.”

Ease of use and lower pricing will lead to greater adoption. The increased functionality of GPS and better gaming will also lead to increased adoption. Its photo geotagging capability will begin to make that endeavor more mainstream. All in all it bodes well for Local adoption.