It is also used for indoor navigation, Google had quite a few talks about this this one is from Google I/O 2013 https://www.youtube.com/watch?v=oLOUXNEcAJk (click to https://youtu.be/oLOUXNEcAJk?t=1985 if you want to see the break down).
There were a few better/more technical talks from 2010 and a few more recent ones that I'm trying to find again.
On android this is exposed through the Fused Sensor Location provider https://developers.google.com/android/reference/com/google/a....
"Fused Location Provider: Get highly accurate location information (latitude and longitude) based on combined signals from the device GPS and sensors."
And the 2nd 2013 talk https://youtu.be/Bte_GHuxUGc?t=400
Orientation/heading from a phone's gyroscope/compass can be pretty reasonable, but most mems accelerometers are pretty much crap for dead reckoning use when loosely attached to a person. I could definitely see some interesting ideas with cell tower position data + heading + pedometer estimation getting merged, but I have a hard time believing that works in practice.
Given a known starting point, or a known point in general this increases both the speed and accuracy of identifying your location considerably even outdoors.
I'm specifically curious about evidence for a commercial smartphone that can track you to room-level accuracy using only IMU + GPS. (Add in wifi or other RF triangulation and it's clearly a solved problem.) In practice with a cell-phone GPS receiver and IMU only, attached to a person it is a hard problem to track a path to within a few meters. Trying to use accelerometer data to get position information over more than fractions of a second in that situation is... tricky.
However the last I heard, powering the gyro + accelerometer constantly was a prohibitive drain on the battery and the relatively low grade sensors used in smartphones made the positional drift rate high enough to be problematic, so I'm pretty sure that the original poster above is misinformed. I'm not aware of any smartphones that use inertial dead reckoning to augment their positioning.
Then skip https://youtu.be/Bte_GHuxUGc?t=700 to for the deep dive :)
You can still do location "manually" by either using GPS or sensor data using the Android framework.
P.S.
I'm pretty sure that iOS has the same thing, I also know that there are a few startups that want to push their own location provider service including sensor based tracking, I've played around with pathsense their location API was faster and considerably* more accurate than Google's https://pathsense.com
*As far as jitter goes, if you are talking about accuracy only to the point of "is jim at the juicebar on the corner of Main St. and 8th.?" they both work pretty much the same.