After watching the iPhone introduction, I was pretty impressed by the sexiness of the iPhone. Apple definitely flexed its design muscles, showing that their leading-edge interface designers are still at the top of the heap, but I have to wonder if Apple expects to compete effectively with the market into which they appear to be positions themselves.
Watching Steve Jobs poke around on the touch-screen keyboard made me wonder whether I could stand using the phone. My Treo is effective precisely because of the interface flaw Jobs cites: the "bottom 40." The Treo keyboard is in my opinion its biggest asset. Most avid Treo and Blackberry users can type as fast on their phone as they can on a PC keyboard, and I believe that's because of the tactile feedback you have with those keys. Typing on a flat piece of touch-screen glass, regardless of the advanced error avoidance or whatever the Apple engineers have whipped up, is going to be pretty frustrating.
In any case, the device isn't even FCC approved yet; Cisco is suing Apple over their use of the word "iPhone," a trademark of theirs; and it's not even slated to be available for another six months. Guess we'll have to wait and see what happens.