Tracking visitors/customers comes to mind. Definitely not uncommon to have 1000 uniques a day :)
http://www.maxmind.com/en/city http://nginx.org/en/docs/http/ngx_http_geoip_module.html
Imagine you want to redirect users to the correct country page in your site. In this case you need to get access to the ip geolocation in real time. GA won't help you there.
http://www.maxmind.com/en/geolite_city_accuracy
It's less accurate than their commercial offering, but good enough in many cases. For ease of use, there's a nice C API (https://github.com/maxmind/geoip-api-c) and wrappers like pygeoip for Python.