its begun, first step to google games services and g+ integration


Hmm, I thought it is common knowledge that phone carriers can track your location if they need to - or if they are called by authorities to do so ?
Common knowledge isn't the same as being made aware. It's not in my phone carriers EULA that they can. There was a big controversy when it was revealed that the iPhone (or 2, or 3, whatever) could do this with even more precision than previously and AT&T didn't mention it at all. That's the only time I've ever seen a carrier update their agreement to even mention that location data is collected.
Anyway in the end it is a matter of "trust" (well actually, it is more a matter of whom to less distrust), and I certainly take my bet on the one who has to oblige to more laws, because that is the only indicator I have to base a decision on.
What laws? I've never heard of any restricting who carriers can share data with. Lots of internal policies I've seen, but no laws. Policies that frequently include handing out data to authorities without a warrant.Google, on the other hand, has refused to surrender requested data without warrant.

Not that any of this matters to me, Canada and (most of?) Europe have constitutional guarantees to privacy.

Some small mistake in your "quotation": "yes, we're collecting data, but here's the ways we will use that data in our best interests"
No, I was right the first time. Their privacy agreement explicitly lays out the data they collect, why it's collected, and how they use it to make the experience better for you. Their business is selling advertising and they make more money by making the experience of being advertised to as pleasant as possible: it is in their best interest to look out for your best interest.
location to high precision
It's not that high. GPS is far more accurate than tower based triangulation can ever be.
 
I got a chance to check out the matchmaking service on a couple games today.

This is exactly what I'm talking about. It just worked, got me in a game, and I was playing with someone else in a different part of the world. It wasn't laggy even though I was playing on a cell phone connection. It was quick.... It acted exactly like you'd expect it to.

This integration with google play games/apps is a killer feature. It's a lot like xbox live, but since my friends and family actually have android phones and not xbox's I can actually play with people I know.

Putting one and one together, this is going to kick ass for the nvidia shield. Can't wait till a decent fps like a halo or call of duty clone takes advantage of this. Pair it with the shield... profit.
 
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Actually the comm tower based triangulation is pretty high accurate if i remember correctly the precision is under 2 meters or something. For sure I can double check this on Monday with one of my colleagues.  :)

Last winter or something, here in Eastern Europe, some tourists got buried under a avalanche, and they find them only because their cell phones were still connected to the comm tower.
 
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