One major advantage is not having to lug my Macbook Pro around everywhere. I can read my email, RSS feeds and eBooks anywhere, anytime.
Another major plus is having my full iTunes collection and podcasts with me.
A lot of the built-in apps work really well and provide the right level of functionality for those of us on the go.
The ringtones are well thought out and pleasant -- you can, of course, with the right software, use any song as the ringtone.
Here are a few of the pluses and minuses:
Pros
- Fantastic integration
- Wireless, automatic calendar and contact synchronisation
- Great selection of applications (see favourites below)
Cons
- No cut'n'paste
- No background apps (yes, I could JailBreak the phone)
- Rubbish camera
Favourite apps
- Stanza
- NetNewsWire (syncs perfectly with the desktop app)
- Currencies
- iBlogger
- Twitterific
- Wikipanion
- 1password
- Things
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