So you don’t fancy the fact that Apple knows where you are at all times? Then you’ve probably browsed through the “Location Services” items in the Settings menu and you’ve also looked through the cunningly named “System Services” section. With no background knowledge these items does in fact look like essential services (Cell Network Search, Compass Calibration, Diagnostics & Usage, Location-Based iAds, Setting Time Zone, Traffic), but the fact is that you can turn off all of these features without losing any significant functionality.
Michael Black says the following about the System Services:
Those features in System Services are all about sending your location based information TO Apple, not about enabling features or services on your iPhone. This is Apple’s way of allowing you to opt out of the collection of location based data that previously was done surriptiously without overtly letting you know or have any way to stop it.
You can disable every single feature in that section and your iPhone or iPad will continue to function exactly the same way it always has.
So there you have it, disable those nasty privacy invading features and be ever merrier.
Finally I also recommend you to disable Location Services for all Apps except those you really need it for like the Maps service.