I'm not saying it's going to be a complete flop...
but...
These are my requirements for a all cell phones:
My requirements are met.
My requirements might be met.
My requirements are not met.
It needs to be a phone;
Good Antenna (My Sony T610 sucks, Wife's Nokia 6600 rocks),
Good Battery life (standby >2 days),
Speaker Phone,
Has a ringtone that sounds like a phone ringing (T610 rocks),
can sync with my Mac (all contact info),
GSM,
Can be dropped without breaking (Nokia 6600 apparently can be thrown across the room

),
Display's callers picture,
accepts voice command,
can send contact info to another phone via bluetooth.
These are deciding factors in whether I buy an expensive cell phone:
GPS Mapping, VERY important (built-in GPS or Bluetooth GPS adapter),
Displays files (pdfs at the very least),
Displays pictures,
Camera does not completely suck (I don't care much about this),
can play games (neat, but not important),
Music/Video (this is a nice feature, but I'd want a mobile version of VLC), there may be other applications I want to use over time.
---
Bottom line:
The iPhone is an awesome product with a fatal (in my case) flaw. This is due to the lack of 3rd party support. I'm betting that Apple is not going to give me GPS mapping. Without it, I cannot justify it's price.
I have no problems whatsoever with Apple ensuring the integrity and clarity of the user interface. I have no problems with them making the authors of Tom Tom, Navicore, or Route 66 jump through many hoops to make sure that the software integrates perfectly. But simply ruling out the third parties seriously hurts the value proposition of the phone.