It's called iHound, and it tracks lost and stolen iPhones.
This app's been around for some time, but like similar tracking tools, it suffered from one major shortcoming: it couldn't run in the background, and therefore couldn't transmit its location unless it was activated. (I don't know about you, but I rarely run my tracker app before I lose my iPhone.)
Now that iOS 4 has arrived, however, iHound can communicate automatically, at regular intervals, even when it's not running. And it does exactly that, sending location data to iHound's servers every few minutes. (Thankfully, there are other interval settings, including 10 minutes and 30 minutes.)
If your phone does go missing, you simply sign into the iHound site to see its last transmitted location on a map. You can also send a push notification with a custom message and even a spoken alert. (Example: "This...is...iHound!" That should get some attention.)
There's even an option to remotely activate a siren, which could help you find a misplaced phone--or startle a thief into ditching it. And the siren can be deactivated only from the site (though an iPhone-savvy thief could simply turn the volume down to zero).
The iHound app costs $3.99, which includes a three-month subscription to the required iHound service. After that, you can get another three months for another $3.99, six months for $5.99, a year for $10.99, or two years for $19.99. All these options are available as in-app purchases.
Much as I hate paying subscription fees for anything, even I have to admit that 11 bucks per year is pretty cheap--especially compared with MobileMe.
The only major difference between the two is that iHound doesn't offer a remote-wipe option to erase your iPhone's memory. That's not a deal-breaker in my book, but I can see where that feature would be important to some.
In my quick and informal tests, iHound worked like a charm. I can definitely see it replacing my previous tracking solution, Undercover.
However, a couple things bother me. First, the developer offers a free iHound sticker in exchange for a positive App Store review. That's ethically questionable. Second, subscription pricing appears nowhere except inside the app, meaning you have to buy it before finding out the bottom-line cost of using it. Why the developer feels the need to closet this information, I'm not sure.
Those issues aside, iHound offers an affordable and effective way to recover (or at least locate) a lost or stolen iPhone. It could even help parents track the whereabouts of their kids.