IPhone 3GS GPS no longer working-What should I do?

Question

I have a very annoying problem with my iPhone 3GS.
I have invested a considerable amount of money on Navigation applications and applications that use GPS.
GPS reception started to get unreliable and it was deteriorating over time.
At the beginning my navigation application (Navigon) was losing the GPS signal at random times.
Usually, after every iOS update the GPS reception was fine for a week or so, then problems started again.
Now, GPS is almost not working at all.
All the gps applications on my iPhone can detect where I am, however the precision is in unusable levels. It may show a position 300-400 meters away from where I really am. This happens in Navigon, Maps, etc.
Navigon always shows the red bar on the top telling me that the GPS reception is not adequate.
What should I do? Is there any case that this is a software related issue? Is there any way I can fix this? Some users suggested that I set up as New, but this will be my last resort as I have a lot of data that I want to retain on my iPhone.
Or is this really a hardware issue?
Any suggestions would be highly appreciated.
Thank you

Answer 1

If you've restored the phone and then reinstalled the SW, it may be a HW problem. There's a way to test to see if the GPS is working in 'standalone mode". It's valid for the 3G, I think it works for the 3GS as well.
On the 3G, the GPS receiver is tied to the cellular transceivers. If it's in Airplane mode the GPS doesn't work. Taking the phone out of Airplane mode, but removing the SIM card (and therefore no cellular connection) it works just fine (OK, it's a bit slower, but it still works).
As a final test, take the phone out of Airplane mode, remove the SIM card and run any GPS aware programme (Maps is good, it's an Apple App, so that removes the 'I wonder if the app is at fault' question). Place the phone in a location where it has a good view of an unobstructed sky, and wait. After 10 or 15 minutes press the "find me" button on the bottom left of the screen. If the "blinking"  little blue dot doesn't appear, or if it says that your location can't be determined (there won't be a map), it sounds like the GPS is dead.
BTW, Apple doesn't reply to posts on the forum.
Good luck,
coop