Not enough emphasis can be placed on the existence of a usable web browser on a phone. It did not exist before. Blackberry was great for emails, and Windows mobile was great for propping your door open, but when Safari on iOS came out, even with it being slow 2G and with a buggy keyboard and no copy/paste -- you could use websites on a mobile device -- anywhere. Being able to pull up amazon and check reviews for products while browsing in a BestBuy or whatever was something that just was not practical before and it was a game changer, instantly.
Lots of people criticized it for not being able to do basic tasks like copy and paste or the lack of 3G after they bought it. The iPhone didn't suffer at all from the criticism because people saw it as a work in progress -- the AT&T attachment was actually brilliant because it allowed them to make AT&T build their network and offer decent data plans. Before iPhone the data rate was something ridiculous as an add-on to a regular phone plan, and everyone using 2G data all at once brought the network to its knees in dense areas and forced upgrades.
Lots of people criticized it for not being able to do basic tasks like copy and paste or the lack of 3G after they bought it. The iPhone didn't suffer at all from the criticism because people saw it as a work in progress -- the AT&T attachment was actually brilliant because it allowed them to make AT&T build their network and offer decent data plans. Before iPhone the data rate was something ridiculous as an add-on to a regular phone plan, and everyone using 2G data all at once brought the network to its knees in dense areas and forced upgrades.