There's a great article on the New York Times website about 3rd party applications and the iPhone. Here's an excerpt:
This is what Steve Jobs, Apple’s chief executive, said to Newsweek in January:You Must Check it.
“You don’t want your phone to be an open platform,” meaning that anyone can write applications for it and potentially gum up the provider’s network, says Jobs. “You need it to work when you need it to work. Cingular doesn’t want to see their West Coast network go down because some application messed up.”
That sounds reasonable until you realize that there are many millions of phones that run operating systems from Palm, Microsoft and others for which third-party applications are created all the time, and networks don’t seem to be crashing as a result.