There were a combination of social and political forces that made the phone a success beyond its obvious technical prowess. Many people don't know this, but Apple had originally negotiated for a monthly residual fee from AT&T for each iPhone and Apple negotiated their own custom activation scheme.
For those of you not familiar with carrier land, this was the first time in the history of wireless networks something like this happened. Seriously, it was unheard of; Apple dictating terms to AT&T. Think of the ridiculousness of the situation; at the time AT&T is roughly 2x the size of Apple and gave the keys to the kingdom away. It's akin to IBM with Windows and DOS, which was again political and not technical.
The iPhone was a Trojan horse. The App Store opened up the carrier markets to apps. Do you know how apps got on phones before the App Store? Pre-loading: the ultra political game of getting manufacturers and power brokers within operators to load your application in the factory. That was basically the only way you'd hit a significant number of users, and even then you were probably buried under 4 levels of menus.
Apple blew that world apart, which was, again, political and not technical. Tons of other companies launched App stores before Apple but Apple executed.
These kinds of massive upheavals in the world don't happen with just technology. There's a tremendous amount of social and political capital required to make something like this work (and frankly some cajones and some luck).
What we saw from Apple was a perfect orchestration of technology, art and the body politic. It's the kind of thing you're lucky to see once in a generation, IMHO.
Edit: Before the iPhone we never had a single person camp out for a phone. On iPhone launch, we closed the store at 3pm to reopen for launch at 4, but people had already been lining up the day before O_O. It's hard to overstate what a shock this was to us. It had never happened before.
It would blow your mind if you knew what people were willing to do to get iPhones. The things I've seen; it's more like an intoxicant than a phone, but it is a great phone, isn't it? It's so hard to categorize the iPhone.
Edit 2: I knew that Blackberry was dead the day my friend walked into my office and demoed an SSH client on his iPhone for managing his servers remotely. Of course, his phone was jailbroken to do this, but nobody even wanted to jailbreak a blackberry. The iPhone is a computer and blackberry was a killer email experience with a phone stapled on.