I don't get it either. Apple has a nice little gadget, but I don't see it as some sort of permanent fixture in society from this point forward. It seems to be a status thing as much as anything. It isn't some revolutionary new thing, just the natural evolution of technology. This technology will evolve so quickly that, while Apple has an enviable market position, they have no lock on future success. Based on their history, I would say it is inevitable that they get beat in this market like they did in the computer market.
Based on their history, someone else will sell the same product for a 3rd of the price.