No you don't, only time you would pay is if you used AT&Ts navigator app ($10 monthly). But google maps is free, or get motion x gps ($1) it gives you one month free turn by turn, and it's $2-3 per month after that. I only need it once or twice a year so it's cool that I can decide when to purchase the turn by turn.
Thanks! I really wanted to know because I am upgrading from an iTouch 2G to an iPhone 4 and I want to use the Geocaching app and Google Maps like u said.
If I remember correctly there was rumor that we would be getting similar free turn by turn as the Droid soon, but I just checked and my hopes look like they are dashed. Made another search and found an app called MapQuest 4 Mobile. Looks promising with street speak features, regular updates, and free. You just want GPS for regular use right, not turn by turn voice directions?