Leave it to Matt Cutts to always be there to clear the air when there is an issue causing some webmasters confusion. One webmaster, Peter, asked Matt Cutts whether geo-detecting techniques is actually against Google’s policies, as it is common for websites to be designed so that users are given the information (price, USPs) most relevant to their lives based on geo-location.
In some understandings of Google’s policies, this may be against the rules, but it turns out all is fine, so long as you avoid one issue.
In one of his Webmaster Chat videos, Cutts explained that directing users to a version of a site, or delivering specific information based on location are not spammy or against Google’s policies. It only makes sense to offer viewers information that actually applies to their lives.
What Google does consider spam is directing their crawlers or GoogleBot to a web page of content that users cannot see. Sending GoogleBot to a different location that what visitors see is a bad idea, which is considered spam or a form of cloaking. Instead, treat GoogleBot as you would any user, by checking the location information and sending the crawler to the normal page reflecting that data.