I am a big fan of the iPhone, but after some diligent research, the Pre might actually give the iPhone a run for its money.
The biggest selling point is really their WebOS, as others have said again and again. With the iPhone, people never really thought about being able to multi-task. Perhaps maybe because it wasn't necessary, but imagine having my calendar, phone, game(s), gps and all other stuff open at once and I can effortlessly swipe thru them w/o losing their stored data. The luxury of having the ability to do this allows for so much more.
What I like to know is, how will Apple respond to this. A half-assed response would be some sort of background application enabler, which is already available via Cydia. I think Apple will have to truly revamp their OS in order to get it up to speed w/ the Pre.
Before the App store developed, the only reason why people wanted the iPhone (besides that it was cool and hip) was the fluid and intuitive OS. Even for their desktop/laptop market, OS X was their biggest gun. With the Pre's WebOS, Apple prolly is really sweating right now and trying to hold off Palm w/ the App store.
Palm actually is pretty smart to have put in already some commonly used apps because most ipHone users have those as well. With that, it will buy them time to mature their app store.
The only other alternative response Apple may have is to open up their OS UI coding for a serious makeover.
I'm liking this competition already...