I’m an iPhone skeptic. While I appreciate good UI design considerably more than the average person, a good UI alone is not enough to make me accept a crippled and overpriced product.

At WWDC today, Steve Jobs has announced that the third party SDK for the iPhone is…make all your applications web applications, and access them from the Safari browser. Which means the user has to pay network bandwidth charges to run the application, and can’t make or receive any calls while it’s running. And of course, no service means your applications all stop working.

So basically, the iPhone is a closed platform, a very pretty but underpowered cellphone. It’s not a smartphone. It lacks even the capabilities of many low-end handsets offered by GSM networks, but it’s going to be sold at a premium price.

Let’s see how it compares with my current 2-year-old phone, for example:

FeatureiPhoneMy phone
Address bookYesYes
Sync with MacYesYes
Web browserYesYes
Google mapsYesYes
Photos of incoming callersYesYes
Instant messagingYesYes
Play MP3, AAC audioYesYes
Play MP4 movieYesYes
Familiar telephone keypadNoYes
3rd party applicationsNoYes
Fits in jeans pocketNoYes

To me, that’s a hell of a tough sell.

You may point out that my tiny phone’s screen isn’t great for browsing the web, but that’s just tradeoff I made because I like a phone that’s truly pocketable. If you prefer a big screen, you can get a Blackberry or Treo for $150 or less. Right now, Cingular has refurb 8525 devices for $99.

I prefer the hybrid solution: pair a small phone with my Nokia N800, and browse the web at triple the resolution of the iPhone. You can get an N800 plus a small Bluetooth phone and you’ve still saved $200 over buying an iPhone.

In addition, most of today’s phones take SD cards for memory expansion. I can dump movies onto a 4GB SD card and stick it in the Nokia. If I need more space, I’ve got a couple of extra 1GB cards floating around. What happens when you use up all the memory in your iPhone? You’re stuck, there’s no expansion option.

If the iPhone was $99, or even $199 at the most, I might be interested. At $599, it ought to sell like the similarly-priced PlayStation 3. It’s the most overpriced Apple product since the Mac Cube. (Which I loved the design of, but didn’t buy because it was overpriced.) It’s the most overhyped since the first Newton.

Oh, I’m sure Apple will sell some. I mean, the Motorola RAZR sucked, but plenty of people had to have it because it looked so cool. But then, the RAZR wasn’t $600…