The new iPhone 2.0 software and 3G hardware up the ante on what was already a spectacularly successful product. A million iPhones flew out the door just on the opening weekend (or, maybe it was only about 425,000; either way, it was a lot).

At the same time, it is easy to generate a list of desired features that are missing from the new iPhone's arsenal. It's pretty much the same items that many users have complained about since the original iPhone started shipping a year ago. Surprisingly, Apple ignored almost all of these complaints in its new software and hardware.

Yes, I am talking about features such as voice dialing, MMS support (the ability to send pictures from phone to phone, as you do with text messages), and expanded Bluetooth support (such as for stereo headphones). And how about even rudimentary copy-and-paste ability? For a good example of a "complete" list of these omissions, check out this recent article in PC World.

These features are not significant enough to be deal-breakers for most people (they certainly aren't for me), but their absence is troubling. Especially so when you realize that most of these options are found standard on almost every other mobile phone on the market. I wish I could have been at Apple for the discussions on these decisions. Did they go something like this:

"So, how about including MMS support in iPhone 2.0? We keep getting requests from users for this."
"I agree. The iPhone already handles text messaging. And it can send graphics as attachments to email. So how hard can it be to provide an MMS feature?"
"Not hard at all. The basic technology is already well-documented. Our developers claim they can get a beta version up and running in less than a week."
"Great. Let's do it."
"Nope. It sets a bad precedent. If we start going down this road, iPhone users will soon have nothing to complain about. Plus it will make our competition look even weaker than they already are."
"Good points. On second thought, let's keep MMS off of the iPhone. Any objections? None? Okay, what's next?"
"Well, there's voicemail..."

"Relax, Ted," you may be saying at this point, "This is exactly what the App Store is for. Third-party developers will pick up the slack and offer whatever Apple failed to include."

Third party developers will certainly pick up a good deal of slack. While they can't compensate for hardware weaknesses (such as the relatively low quality camera in the iPhone), they can address software omissions. The problem is that they won't fill in all the gaps -- primarily because Apple won't let them.

Don't bet the farm

For example, a third-party could provide software that allows the iPhone's camera to record video. Indeed, Polar Bear Farm offered just such an program (called ShowTime) for the original iPhone -- although you needed to jailbreak the iPhone to use it. It is reasonable to expect that this sort of software will appear in the App Store. It may seem reasonable, but don't expect to see it any time soon. Polar Bear Farm's revised home page no longer links to this program. They explain (as cited in an ars technica article): "As for ShowTime, it simply can't be done—the legit way, anyway—given the current constraints on the iPhone SDK. Polar Bear Farm is 'a little reluctant' to continue development on it for that reason."

GPS limits

As another example, consider the new GPS capability of the iPhone 3G. It's fine as far as it goes, but it doesn't offer the turn-by-turn navigation that is the hallmark of stand-alone GPS devices. It might be natural to assume that a third-party will release (via the App Store) GPS software that fills this gap. Don't count on it. First, there is a bit of debate as to whether or not the iPhone's hardware is capable of this task. On the one hand, Apple is quoted (in the New York Times review of the iPhone 3G) as stating that "the iPhone’s GPS antenna is much too small to emulate the turn-by-turn navigation." But wait! If this is true, how is it that both TomTom and TeleNav claim to have all-but-completed development of just such software? Even if we assume the hardware problem is largely a myth and the software is ready to roll, it may never actually ship. Why? Because a restriction in Apple's SDK prohibits software "for real time route guidance." In other words, it's not so much that it can't be done as that Apple doesn't want it done (for whatever reason).

Interestingly, Apple VP Greg Joswiak recently commented about the iPhone's "missing features" -- confirming that turn-by-turn navigation is possible on the 3G and that he expects it to be offered some time in the future.

No to patching

How about voice-dialing? Here's another case where the App Store is not likely to be a solution. What you ideally want is not a separate application that permits voice-dialing, but integration of voice-dialing into Apple's existing Phone software. To do this as a third-party, you would have to patch into Apple's software. This is not something Apple is likely to permit. And with some good reason. Apple doesn't want to have to worry that an update to its own software might "break" a third-party patch or otherwise cause problems with the update, leading to complaints directed at Apple even though it is not their fault.

Similarly, a system-wide copy-and-paste function will almost certainly have to come from Apple itself. There is no way a third-party could integrate such a feature into the iPhone. In this regard, Apple VP Greg Joswiak (continuing his comments about the iPhone's "missing features") claimed that cut-and-paste was not a high enough priority for Apple to have made it into iPhone 2.0.

Utility restrictions

If the current collection of utilities in the App Store are any indication (and I believe they are) there is at least one more category of software that you won't be seeing for sale: system utilities. By this, I mean utilities that provide "under-the-hood" access to the iPhone. This category includes the ability to perform tasks as basic as viewing the full contents of the iPhone, including Library folder files -- just as you can easily do for a Mac via the Finder. It also means having a Terminal application to run UNIX commands. It means the ability to edit items such as property list (.plist) files. And it means being able to mount the iPhone on a Mac as if it were an external drive. Such utilities are admittedly not for all iPhone users. But for those who'll use them, these utilities are a tremendous asset. Sure, most Mac users have never edited a plist file and never will. But do a Google search and you'll find hundreds, if not thousands, of pages devoted to this topic (including a series written by yours truly) -- detailing all the cool things you can do by editing these files. Still, even though Apple permits such editing on your Mac, even providing a tool for doing so (Property List Editor), I doubt Apple will allow this or similar tools in its iPhone App Store.

Bottom line

Is there a way around this Apple-enforced blockade? Not entirely. The obvious alternative is to jailbreak the iPhone, so as to provide and access software that Apple won't allow in its Store. According to the folks at the iPhone-dev team, the release of a jailbreak tool for iPhone 2.0 is imminent. There has been some question as to whether the jailbreak would initially be just for original iPhones (and iPod touches) or for the iPhone 3G as well. It now appears that all iPhones will be jailbreakable (is that a word?).

While a jailbreak utility may open the gates to system utilities and some patches, it won't be a complete solution to the App Store restrictions. If you're a company that expects to sell software in the App Store, you probably don't want to annoy Apple by turning around and releasing Apple-prohibited software to the jailbreak-community. That's almost certainly why, for example, Polar Bear Farm has dropped development of ShowTime. Similarly, given that there is no way to assure revenue for jailbreak software, many developers won't see it as worth their while to pursue that route.

It's a bit sad to realize but, under the current situation, there is great software for the iPhone that may never see the light of day -- simply because Apple doesn't want you to have it. Apple is the cheesecloth that all potential App Store software must be filtered through. If Apple gives thumbs down to an application, that may well be the end of it.

Don't get me wrong. I believe the App Store is already fantastic just as it is. Indeed, it is the single most significant feature of the entire iPhone 2.0/3G transition. The games are fantastic, much better than anything that was available via jailbreaking. The various productivity tools enhance the iPhone in ways that Apple alone could never do. However, it remains clear that Apple intends to keep a tight rein on what can and cannot be installed on your iPhone. It is still a closed system. In a previous column, I contended that, for similar reasons, the iPhone did not yet qualify as a "Mac in your pocket." This remains the case today -- even after the release of iPhone 2.0.

Update: Things change rapidly in the iPhone world. In the hours since I completed this column (but before it was posted), I've already seen several new reports relevant to this topic. In one report, an iPhone app developer laments yet another problem with the "closed shop" nature of the App Store: If users start reporting bugs in your app, there is no easy way to get the feedback needed to determine the cause of the bug. Even worse, there is no way to beta test updated software to confirm that the bug has been fixed prior to an official release a new version.

Ted Landau is the founder of MacFixIt, and the author of Take Control of Your iPhone and other Mac help books.