lucy24 - 10:28 pm on Feb 29, 2012 (gmt 0)
The ISPs upload the list of IPs and their "approximate" location to the location providers.
For a given definition of "approximate". Today, the first two places I checked say I'm in San Jose and Milpitas, respectively. At other times they've said I'm in San Francisco, Santa Rosa or Redding. As far as I can remember, I have never seen one that's within 200 miles of my actual physical location.
Hm. Maybe I shouldn't be so quick to believe the tool that says this visitor is in Clyde River while that one's in Chesterfield Inlet.