It wasn't just that the Palm Pre was made out of plastic... it had general build quality issues too.
The slider wasn't very good... the keyboard wasn't so hot either... the MicroUSB door can snap off... the power button can fail. And there were even some reports where the screen twisted around. It's not supposed to do that!
While the iPhone 3GS is made of plastic... it's also a solid unit with no moving parts. Big difference.
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That's only part of the story. Hardware wise HP had done a decent job in improving an old design. The Pre 3 has a good slider, a decent keyboard and nothing falls off..it even feels solid. I have one for over 3 months now without a single (hardware) problem.