In my eyes, the iPhone is nothing more than a toy. I was extremely enthused about mine in the beginning but lost interest very quickly. I'm now using a Blackberry Curve again and the iPhone sits on my night-stand to be used as an iPod. I like the iPhone's great screen. Using it is easy and fun but also very limited. Doesn't have cut and past, for example, keyboard use is inconsistent, PIM functions are a joke (plays the alarm sound ONCE for a calendar alarm, for example. Unable to repeat alarm sounds etc. - WTF?), the keyboard only works if you type in English or High German, Swiss German, for obvious reasons, isn't supported - which isn't a problem with normal phones but the iPhone's touch-keyboard highly relies on the auto-correction.

Push-mail doesn't work, no support for e-mail aliases even on .Mac, Safari frequently crashes, no flash, which makes navigating 70% of the websites a pain or simply impossible.
The choice of software, even when your phone is locked, is a joke. Most of the apps are hacks, nothing works well.

I could go on for hours here - my point is: I don't like it. Perhaps things improve once the SDK is out.

dawiz