It's. The. Usability. Stupid.
So you have room for nine icons (almost) on your main screen. Do you (a) use one for a "clock" rather than, say, display the time somewhere in your utterly useless status bar and menu bar? (b) use one icon for a "clock" and another for "date and time" (given you're already showing the date anyway)? (c) use a third icon for "calendar" because two just wasn't enough? or (d) add a Windows 98-style gradient bar up the top to waste even more space? If you answered (d) you're ready to design Open Source UIs and take on Apple in the consumer space.
I saw something pretty funny on Digg yesterday. The link didn't work (which was a sign in itself) but googling got me this. Here's the summary: real soon now™ there will be a Linux-based smart phone with 3G network support and a touch screen that does everything the iPhone does, only better, and runs Linux -- sorry, GNU/Linux -- and is totally, utterly open. So it will be better than the iPhone in every way.
Woohoo! At last I can use something other than my tin-foil hat to communicate with the mothership.
Here's the problem. Aside from being "open" ... pretty much any non crap cell phone does everything the iPhone does ... at least to some extent, and is more "open" to third-party development. The iPhone isn't different and better than those phones the way, say, a current MacBook Pro is better than say an Apple II. It's better than those phones in the same way that a MacBook Pro (running Mac OS X) is better than a MacBook Pro (running GNU/Linux). When folks suggest Apple has a five year lead on rival cellphone companies, they mean that Apple's software is five years ahead of rival cellphone software the way Mac OS X is ahead of, say, GNU/Linux. (Since GNU/Linux is actually about five years behind Windows, it's more like an eight year lead on GNU/Linux.)
And the lead isn't in features. Every computer is a Turing machine limited by finite RAM. The only fundamental difference in ultimate capabilities between any two computers is their peripherals and data capacity. The difference for users is in usability.
As my father used to say, "Chocolate is good. chicken is good. Chocolate-coated chicken must be excellent." It works even better when both ingredients suck individually, right? Linux is a usability nightmare. Cellphones are a usability nightmare. But a Linux cellphone is going to rule! Kind of like Kentucky-fried chicken smothered in rancid chocolate.