Any sufficiently advanced technology is indistinguishable from magic.
Arthur C. Clarke, "Profiles of The Future", 1961 (Clarke's third law)

And by failure I mean unmitigated success.

But I do also mean failure as viewed through our Ray Kurzweil jaded shades. We expect so much out of our technology these days that a device as radical and beautiful and exemplary as the iPhone is still seen as incomplete.

Comparison

Compare it to the most radical phones of the 1990s. I'd argue it wasn't even a phone that was radical back then, but the Palm Pilot, a PDA. The Palm Pilot experimented with the user interface...how would someone work with a handheld effectively.

Compare it to the phones of the mid 1980s. Just having a mobile car phone by itself was the cool thing. Remember the bricks? Remember the mini-briefcase sized phones? 'nuff said.

Why do we not laud it for what it is

What we have here is accelerating returns personified. We are so human that we can't see what has happened. Our perception of the future is constrained by our living in the present.

The iPhone is not perfect.

It does not do absolutely evertyhing in a perfect way. It should be on a fast network. It should have more memory. It should allow us to change to competing phone networks.

What it does do is let us see what can be done, what should be done, and what will be done.

Comparing a current version of the iPod against the earlier versions gives us insight into what changes we might have in store from Apple vis a vis the iPhone. 2-3 years from now we'll be 2-3 versions in and the iPhone will have plugged its remaining product holes.

You will need to be ready for the future because it is on the way here whether you want it or not.