Why does GPS depend on relativity?

I am reading A Brief History of Time by Stephen Hawking, and in it he mentions that without compensating for relativity, GPS devices would be out by miles. Why is this? (I am not sure which relativity he means as I am several chapters ahead now and the question just came to me.)

Answer

Error margin for position predicted by GPS is $15\text{m}$. So GPS system must keep time with accuracy of at least $15\text{m}/c$ which is roughly $50\text{ns}$.

So $50\text{ns}$ error in timekeeping corresponds to $15\text{m}$ error in distance prediction.
Hence, for $38\text{μs}$ error in timekeeping corresponds to $11\text{km}$ error in distance prediction.

If we do not apply corrections using GR to GPS then $38\text{μs}$ error in timekeeping is introduced per day.

You can check it yourself by using following formulas

$T_1 = \frac{T_0}{\sqrt{1-\frac{v^2}{c^2}}}$ ...clock runs relatively slower if it is moving at high velocity.

$T_2 = \frac{T_0}{\sqrt{1-\frac{2GM}{c^2 R}}}$ ...clock runs relatively faster because of weak gravity.

$T_1$ = 7 microseconds/day

$T_2$ = 45 microseconds/day

$T_2 - T_1$ = 38 microseconds/day

use values given in this very good article.

And for equations refer to HyperPhysics.

So Stephen Hawking is right! :-)