W: It really is just a phone with a really good user interface and good software - it runs OSX, as you probably know.
I use an old Sanyo phone now that runs the Opera web browser really well on the regular Sprint network. This phone's UI stinks.
The iPhone's soul is the OS + UI and that is where it will shine, IMO. It may look nice, but the way it works is why it will sell millions.
A lot of phones have similar or better "features" than the iPhone, but none that I know of have the cross feature integration, solid OS and an ease of use that the iPhone will offer. It's also a real computer.
Just like the iPod was just another digital music player that took off because of the UI, I expect the iPhone to follow this path.
IMO, it's not a big stretch to believe the iPhone will be a huge seller. They've been testing this sucker for a while now, and Apple has become quite good at selling mini-computers. Pick up an iPhone and some AAPL shares too - the stock is still cheap, IMNSHO.
Best,
Kurt