iPhone 2.0–Good, Fast, Cheap: Pick Two.

Choosing a smartphone reminds me of the old adage from product-design people: “Good, fast, cheap: Pick two.” Much more so than a personal computer, a smartphone is an exercise in compromise.

This will continue to be obvious even after Apple (AAPL) announces “iPhone 2.0″ at this week’s conference for Macintosh and iPhone software developers. This new device, of course, is the updated version of the path-breaking model that was launched a year ago amid a blizzard of hype.

I continue to be an iSkeptic of sorts. I don’t own an iPhone, and even if all the rumored new features appear they probably won’t be enough to overcome Apple’s still-unfortunate choice of AT&T (T) as its telecom carrier partner.

True, no other device does exactly what the iPhone does. Conversely, the iPhone doesn’t come close to matching the most valuable features of the devices I do use, namely Research in Motion’s (RIMM) BlackBerry Curve and Nokia (NOK) N95. Let’s look at each to see why.

My primary device is the BlackBerry, for two major reasons. First, using T-Mobile’s clever UMA technology, which does a voice hand-off from cell to WiFi–something that works on several T-Mobile handsets, but not the BlackBerry Curve on other networks–I can use the phone (and save cell minutes and money) using voice over IP. This is especially helpful at home where the cell signal is weak, but also helpful given that it works with just about any WiFi network. AT&T hasn’t built UMA into its own network, and Apple’s first iPhone did not permit VoIP in any case.

Just as important, the BlackBerry’s physical keyboard–small keys that are nonetheless accurate and have a nice tactile response–makes it a mostly excellent email tool.

Mostly, but not completely–because BlackBerry’s email capabilities are designed around Microsoft Exchange. I do use Exchange for one email account, but IMAP on several others. And the BlackBerry has no IMAP client software that even understands how to flag a message as having been replied to, much less an understanding of folders.

I would pay good money for a solid IMAP client for the BlackBerry, but no one seems to care enough to create one. I suspect there’s a serious market for the first company that does this.

If the iPhone had a tolerable keyboard–and I find the virtual, screen-bound keypad nearly useless–it would be a vastly better email device than the BlackBerry, especially because it absolutely gets IMAP and is about to work with Exchange servers.

The iPhone’s camera is roughly equivalent to the one on the Curve: inadequate at best, with relatively low resolution and no video mode. Nokia’s N95, by contrast , is a great camera, with a 5 megapixel still resolution and 30-frame-per-second VGA video recording and playback.

I can “tether” the N95 to my laptop and use it as a modem; no such common-sense usage with the iPhone. The N95 also has WiFi (and handles VoIP) and 3G, invaluable for international travel; strong rumors say the iPhone will remedy the 3G situation in the new version.In fact, the N95 has almost too many high-end features, a key reason it has especially poor battery life. GPS is another N95 advantage; again, there are strong indications that the iPhone will also have it–and the large screen on the Apple device makes maps a joy to use and view.

I do love the iPhone as a media playback device, however. That’s why I bought an iPod Touch, which is roughly the same size and has become my portable media system of choice, especially on airplanes. And when it comes to Web browsing, it’s absolutely no contest: The iPhone blows away the Blackberry and N95.

Apple raised the bar in a serious way when it comes to software. While Nokia’s operating system has been much more open than the iPhone’s (or BlackBerry’s)–something Apple has halfway remedied with its semi-open new development model–Nokia has a long way to go to get even close to Apple in basic usability. The BlackBerry is quite easy to use, but still far behind Apple in many respects.

Will I buy an iPhone when the new models hit the stores? I still don’t know. Apple’s insistence that legitimate software will only be available through its online store is part of the company’s typical arrogance. And its continued lock-in with AT&T is close to a deal-killer no matter how good the device may be.

Of course, you can “jailbreak” even the current iPhones. And it’s looking as though the new ones will be even more malleable, at least theoretically.

No matter what Apple introduces, the compromises will continue, however. But the time is almost in sight when we’ll have just about everything we want–not just what we absolutely need–in our handhelds. Not real soon now, but sooner than we might expect.


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