The first iPhones were actually not that great comparatively. They were pretty slow and they didn't even have 3g. But, Apple got a lot right, they had an intuit

The first iPhones were actually not that great comparatively. They were pretty slow and they didn't even have 3g. But, Apple got a lot right, they had an intuitive multi-touch interface that anyone and everyone could use, they had a simplified ui, etc. Then they came out with the app store. And with the 2nd gen with 3g support they had a very solid product that had mass appeal. It didn't hurt that they had the Apple cult following driving adoption, but still they pushed things forward a lot.