I think it's an inherent usablity issue. The two functions I'd like from a smart phone (other than calls and SMS), is mapping and the odd web lookup. I've currently got a Blackberry as a hand me down with the old form factor: half screen, half keyboard. Personally the keyboard is too much of a nuisance for me, and most websites just don't work that well on it. To the point, I'll only use it, if I really have to. So most of the time, I have an oversized item in my pocket, that I don't really care for, that runs out of battery quickly, and makes me curse daily.

A classic old phone (small nokia form factor) with WAP style browsing would actually suit me more.

But actually I think it's more a matter of coming up with a user interface that can work with a small screen. Pure text isn't that bad.