As much as I love web applications, sometimes they're simply just not suited for the task (music streaming, etc.) right now. Even current simple web applications for the iPhone, like Gmail, aren't perfect (but oh do I love it over the native Mail client). But with Apple's help in creating (albeit proprietary) standard for a mobile web app (
http://ajaxian.com/archives/iphone-full-screen-webapps), the mobile web experience should be getting better (why hasn't Google implemented this yet?). The way I see it, we'll be having web apps and native apps sitting side by side on our mobile devices for quite some time in the future (if not already).