No, the device doesn't *always* know where it is. That's why 
getLastKnownLocation() returns null sometimes.
Obtaining and maintaining a GPS fix (location) is expensive for the battery. 
Only when needed locations are obtained and maintained.
I think that in API-level 8 a new location provider was added to passively 
obtain a location, using other apps' gps-fixes:  
LocationManager.PASSIVE_PROVIDER 
 

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