What happens depends on what interests Google more: driving the spread of Android through less-than-fully-aligned carriers, or gathering the data that everyone using these with iOS could provide. I'm guessing the latter.
Apple may respond not by blocking a fantastic bit of kit (which would infuriate customers) but by buying a company that has its own patents on similar technology and building on the play they made in buying C3 from Saab. I'm hoping the latter.
http://news.softpedia.com/news/Fraunhover-Wants-to-Beat-Goog...
Apple is a hardware company focused on seamless user experience, and highly skilled in nurturing a commercial developer base. They can think mapps.