If you're willing to make your location known in order to take advantage of location services why wouldn't you want the very best possible service? There are complicated workarounds that can be used in place of Google's location services but none of them are anywhere near as easy to implement for the app developer or as easy to use or as accurate for the end user.
GPS doesn't make your location known at all, it's receiving only. It sends information about your location to nobody, it triangulates your position from publicly broadcast signals.
And, I would much rather "make my location known" to about fifty other companies before I would want Google to have it.
Yeah, GPS is actually insanely cool technology, and the US making it available to everyone was a real public service. Now of course, other nations are, partially for defense purposes of course, deploying similar networks as well.
And it's just out there. Usable with no subscription, no account, nothing. It's just free data.
Notice I didn't specifically mention GPS, although I agree that it is pretty cool. That said, GPS alone isn't capable of providing the UX that end users expect from a modern app. Fused Location is required for more accurate location information and it isn't passive like GPS.
