You're still thinking in terms of features. Markets aren't won by feature lists. Geeks like features, but the vast majority of the consumer market is non-geek. The iPod is a very straightforward product that's always had an innovative, easy-to-use interface without too many features. It's also dripping with style, and it's well-marketed. Cell phones that happen to play music are just that--cell phones that happen to play music. Though some cell phones have some nice exterior styling, their user interfaces are pretty much universally clunky and nearly unusable. There's also nothing like that iTunes + iTMS + simple syncing synergy in the cell phone market, but that's only a piece of a well-engineered and constantly tuned system designed to keep people buying iPods and music and videos, and it's working remarkably well. Phones that play music have no appeal beyond all the also-ran mp3 players, and probably considerably less due to the awful interfaces.

The #1 complaint I hear about cell phones is that they're hard to use and have too many bells and whistles that clutter the interface and are difficult to navigate. This is not a big deal to a geek who is used to navigating bizarre control structures or a teenager with more free time than is good for them, but the average person is just annoyed by the clutter.

The iPhone brings the qualities that made the iPod successful to the cell phone market, and it's clear now that it's not going to bomb. Whether it's going to be a huge long-term success is still up in the air, but clearly it's doing okay now and iPods aren't being neglected either.

Levi, I have yet to see how the other music playing cell phones are not like an iPod. You are probably right if it is due to the fact that there isn't really anything out there that just "automatically" syncs your tunes to your cell phone when you connect it to your computer (please, point me to one, I'm really trying to find one!). My point was that yes, Apple may have the upper-hand in the auto-sync market, but there are still plenty of cell phones that play music. What the iPhone is doing is making customers look at their cell phones and realize this, which I believe will eventually direct attention away from the iPod. Maybe it hasn't done so yet - I may be wrong in this blog post specifically (I'd like to see numbers that prove that though), but I strongly think that if Apple doesn't stay ahead of the game, other cell phone makers could easily take this market.

The difference between the iPhone and the iPod is that when the iPod came out there wasn't as large a competition in the hard-drive-based mp3 player market as there is in the cell phone market. The iPhone comes out during a very advanced stage of a super-saturated market. Yes, they probably need to do it to stay competitive - it's a great market to be a leader in, but they're going to have to work a lot harder to lead in this one than they did in the iPod market, and they could very well see their iPod line fizzle away as they put their focus towards this.

Heh, came across this while following links after writing my previous comment. Funny, calling the iPhone a failure and claiming you were right after just a couple of days. In your iPhone-related posts, you consistently miss the point of the iPod and iPhone. Unless the latest crop of music-playing cell phones is radically different from all the other phones I've used, they are decidedly not like an iPod, haven't been hurting the iPod's market, and won't hurt it in the future. This misunderstanding doesn't surprise me; geeks have been misunderstanding the iPod since it was first reviewed on Slashdot, where it was widely seen as a total flop.