Apple brought touchscreen phones to the mainstream. They are in the unique position of having their "cult" that will stay loyal regardless. They also have unlimited goodwill from the media types who tend to do their work on Apple's machines. This is part of the underrated aspect of their success, whereby the media types will back Apple regardless of whether they have the best device on the market. Not forgetting the apparently simplistic user interface. Like it or not, most people in the World, and the USA, are not the smartest. Just as the top 5% may own the majority of the wealth, the top 5% in intelligence is also a small number of people. Simple is good for the rich but stupid. There is also the high-priced status symbol aspect. Everyone knows Apple products do not come cheap. How else do phones such as the Arte, Vertu, Tag etc keep selling? And I know a couple of people with money who bought Arte and Vertu phones just because they are expensive and like the expensive materials used.

I will be interested to see how the next iteration of the iPhone turns out. The industry seems to be moving towards WVGA, will Apple follow? If so, how will they maintain app compatibility with such a change in resolution ? Will that alienate older users and will developers move to design exclusively at the new resolution, or will apps be easily scaleable? It's going to be interesting.

I have a feeling that Apple are happy to occupy a niche (high-paying) market as they do with their computers. The iPod started hugely successful until mobile phones cut into their profits and they jumped in with the iPhone. How will they keep their high profits sustainable ?