[magellan]

I have one question for Apple about the iPhone:

It runs OSX and has an Internet connection, but instead of having iTunes built in, you run iTunes on a separate computer, download your music, then plug the iPhone into the computer running iTunes and sync it?

That was an absolute no-brainer which would have made the iPhone really unique.

As it ends up, it is a clunky phone or a storage crippled iPod with a big screen. But it has a really cool interface.

[HAL9000]

It's more economical to use the PC for the primary storage location of music. Users can load music from the PC to the iPhone without incurring Cingular's data transfer charges. If a song was downloaded via Cingular network instead, that could significantly raise the cost of purchasing a song from the iTunes Store.

I agree with you about the storage limitations. Future generations of iPhone should increase the capacity. The 32GB or 64GB iPhone will be awesome.

[Swordmaker]

It runs OSX and has an Internet connection, but instead of having iTunes built in, you run iTunes on a separate computer, download your music, then plug the iPhone into the computer running iTunes and sync it?

Give them time... the limitation about directly connecting an iPod to the iTunes music store has probably more to do with the Music industry's requirements for DRM than what Apple wants. The Music Industry has just informed Microsoft that they want them to cripple the Squirting capability of WiFiing music from one Zune to another.