I think shipo nailed it. After doing a little research, it looks like many "GPS" trackers on cell phones use cell phone towers to locate the phone. And the result can be off by quite a bit depending on the number and location of towers in your area, as well as things like the battery charge on your phone. If you want to read up on te basics, check this article: http://en.wikipedia.org/wiki/Mobile_phone_tracking.
Even conventional GPS such as Garmin may have significant error in the neighborhood of 5%. It just depends on what kind of day they're having, the location of satellites relative to your location, false or reflected signals, etc. This is why runners often complain about "mis-measured" race courses when their Garmin measure 13.42 miles for a half-marathon.