I carry an iPhone as my phone/sms/simple web device as well as a BlackBerry for email/GPS/Handmark Express device.
For me, the iPhone is an OK phone, with OK web browsing, but with a lifesaving voicemail interface. The VM alone sold me on the iPhone. The ability to selectively choose certain voicemails and ignore or postpone others has been lifechanging. Turning on my phone after a long flight with the dreaded "You have 16 new voicemail messages." and knowing that I need the 16th was very bad.
So far the iPhone has worked well in the UK and Singapore, but not Japan.