McNealy said, "There's a pendulum thing where stuff is on the client side and then goes back into the network where it belongs. The answering machine put voicemail by the desk, and then it went back into the network. Your iPod is like your home answering machine. I guarantee you it will be hard to sell an iPod five or seven years from now when every cell phone can access your entire music library wherever you are."
Looking back, the iPhone was a natural product that would cannibalize the iPod market but I bet Apple shareholders are very happy that Apple did that instead of letting someone else (notably Android, in hindsight) take away the market from under their feet. Call it luck or call it genius, it is definitely a success.