> But it had a touch screen that felt nice, and you could watch videos and play music! The web browser actually performed well despite the low bandwidth.

Basically an observation that consumers were interested in digital media players, which Apple had some expertise in building (iPods, for younger folks).

And that a usable browser was a killer feature (most of the web not having reactive mobile sites, and no apps, then).

And if you combined all of the above with a cell phone, customers would rather carry 1 device than the 3 it previously took.