While parts of the iPhone 3G are superb, there are still some big features missing from this device. If you add up the extras the iPhone doesn't seem like a phone that everyone can afford.

How do you review a phone with this much hype swirling around it? If the iPhone was on trial for murder, no one who had followed the iPhone's progress would be allowed to join the jury for fear of their pre-conceptions influencing the verdict. In Australia we have the advantage of not having seen an official iPhone release last year, but there's been plenty of first-gen iPhones to play with before now.

Design
Simplicity is the key, and typical of Apple's product range. Physically and in regards to the interface, simplicity is what drives its design, and for the most part it works well. Apple is so confident of the design that it doesn't include a manual in the box. We're not ashamed to admit we've needed Google several times to show us how to perform certain tasks.

The iPhone 3G feels as good as it looks. Its slick glossy exterior fits perfectly in your hand, and feels comfortable against your face. The 3.5-inch display is bright and clear, and never leaves you wishing it were bigger or easier to read.

The much-lauded interface is a pleasure to use with finger-friendly buttons and charmingly designed icons. Screen real estate in most applications are dedicated to what is most important, without menus or settings to distract you. Physical input is well thought out and is reasonably intuitive. Gesture controls using the multi-touch screen are great and easy to pick up.

Far less intuitive is the integration of some of the key applications. For example, images can't be attached to an email while typing the message, the only way to do this is by selecting the option in the photo gallery. If you decide to attach an image after punching in the message, it's tough luck — without copy and paste you'll be left re-typing the entire message again. Similarly, most settings for the individual applications are only located in the General Settings pane, meaning you have to exit an application to change one of its settings, then re-enter the app to continue your work.

A point of contention for the original iPhone was the on-screen keyboard. Apple has worked hard to include a slew of business-focused functionality in the iPhone, but we predict a lot of business people will shy away from a smartphone that's without a full, physical QWERTY keyboard. After using the iPhone for several days we have got much better at bashing text into messages and search fields; however, it's still considerably more cumbersome than using a BlackBerry, or similar.

3G, Wi-Fi, connectivity
3G is such an important selling point for Apple in this second release that it becomes part of the iPhone's product title. Yet it's hard to congratulate Apple for including a feature we see every other day of the week in the phones that cross our desks. No 3G in the first generation was an astounding omission, its inclusion in this release is simply a correction to this oversight and allows the iPhone to compete with the growing range of excellent smartphones in the market.

We've been lucky to have been able to test the iPhone 3G on Telstra's Next G network, making our review unit one of the world's fastest iPhones. However, we're yet to see data speeds faster than those that are being reportedly delivered by Optus and Vodafone. On average we've experienced data throughput of about 1Mbps, which isn't mind-blowing.

As with the first generation, Wi-Fi is the saviour. Setting up a connection to a Wi-Fi network is as easy and painless as it can possibly be, and the results far outshine the 3G throughput, equating to about three times faster downlink speeds.

And what about all the terrible things you've heard about limited Bluetooth profiles and no MMS messaging? It's all true. Out of the box you can only use Bluetooth to connect to a hands-free headset, so no A2DP stereo Bluetooth, file transfers or internet sharing. Pictures you take can be emailed to friends, but not sent directly to another mobile device. Though, with the dismal quality of the camera this is not such a great loss — but more on that later.

Web browsing
Believe the hype: the Safari browser is fantastic. Web pages render quickly, and most importantly, clearly. Pinching, spreading and panning finger gestures are some of the most intuitive controls imaginable and as much fun to use as they are efficient. The browser also incorporates one of the best tabbed browsing solutions we've seen on a mobile device. Though it's not without its hiccups. The popular Sydney Morning Herald website struggled to render correctly and inexplicably crashed the browser twice in the space of five minutes, sending us back to the Home screen.

Worse still, on our first day of testing, the iPhone crashed twice and needed to be hard reset. Once was during Web browsing while we tried to view a large image on a Web page. The second crash occurred when using a program we had downloaded from the App Store called SnapMyLife — a geotagging photo blogging application.

GPS and location-based services
After the official iPhone 3G announcement, experts agreed that GPS would be the most important improvement for the iPhone. In fact, analysts have been speculating whether a GPS enabled iPhone would be the death knell for stand-alone navigation devices. However, to strike this nail in the coffin of personal navigation devices the iPhone needs navigation software, and we were disappointed to discover this type of software is not pre-installed.

What is installed is an iPhone optimised version of Google Maps, which we love. Updating your current position is a one-click operation, and searching for local businesses is a breeze. Best of all is how Google Maps is integrated with other iPhone functions, like being able to call a business directly from its Google Maps entry. That said, Google Maps is more a Yellow Pages substitute than a true navigation solution and doesn't offer any sort of voice-guided turn-by-turn navigation, making it nearly useless for travelling with in your car. The software can plot a course, but checking your progress while driving would be extremely dangerous.

Also absent is any form of GPS statistics including signal strength or the amount of data used by the phone to triangulate your position using Assisted GPS (A-GPS). The latter is troublesome considering what a sticky issue mobile data allowances are in Australia at this time, and is compounded by there being no option to turn A-GPS on and off.

It's quite a shame as the GPS hardware is superb. Within moments of opening Google Maps outdoors, the iPhone pinpointed our position and was tracking our movements with outstanding accuracy. Hopefully the rumoured TomTom mobile navigation software for the iPhone is nearly complete — though expect to have your credit cards ready for that one.

Calling, messaging & email
We weren't surprised to discover that the iPhone does all the basics well. The calls we made were loud and clear, and we enjoyed good, strong reception. SMS messaging includes threaded messaging — where consecutive messages to a single contact are listed like an instant messaging conversation — and is a feature also available in BlackBerrys and the soon-to-be-released Windows Mobile 6.1.

Email can be automatically configured if you use one of the listed compatible email services; MS Exchange, Apple's MobileMe, Gmail, Yahoo or AOL. Otherwise you have to go through the arduous process of entering your mail server settings manually. We were disappointed to find that Windows Live Hotmail accounts aren't apart of the list of known email servers, considering the popularity of this service in Australia (although Hotmail is accessible through the Safari browser).

The iPhone 3G supports push email for MS Exchange and MobileMe. All other services are updated manually when you open the email pane. Reading your email is exactly as it should be; the messages render clearly and the iPhone is capable of viewing numerous attachments such as images, some MS Office documents, and PDF files.

iPod and media playback
The good news is that the iPod is almost identical to the application found in the original iPhone and iPod Touch. Syncing with iTunes on your Mac or PC is simple, and media playback is excellent; the menus are fast, especially cover flow, and the sound quality is great.

Interestingly there is no music player options or settings in the iPod application. When we started listening to music using the bundled earphones our first thought was that we'd love to pump the bass up a few notches, however, this is only possible by exiting the iPod app and going into the general phone settings. Even phones that play music at half the price of the iPhone include equaliser settings in a context menu; the Motorola ROKR E8 includes a dozen preset options and seven levels of "bass boost".

Luckily, the poor sounding bass is due to the crummy bundled earphones and not the iPhone's audio hardware. The iPhone's 3.5mm headphone port means this is easily overcome by using your favourite headphones, or by plugging the iPhone into a compatible sound system.

Video playback is fantastic when playing iPod optimised MPEG-4 files. This is true of all media you have access to with the iPhone. The iPhone will play MP3, AAC, Audible, Apple Lossless, WAV, and AIFF audio files, as well as MPEG-4 or H.264 video files.

Camera
There's not much to report here. The iPhone's 2-megapixel camera is one of the worst we have encountered, especially at this price point. The picture quality is average but it's the bare-bones camera software that has disappointed us most. No flash, no auto-focus, no digital zoom, no photo correction application, no adjustments in size or quality, no white balance, no colour filters. Basically, you have to be standing in a well-lit environment with your subjects close to you for your pictures to turn out well.

App Store
This is easily our favourite iPhone feature. There is simply no better, "one-stop shop" style download service available for smartphones. Even at launch, the App Store is populated with dozens of excellent new applications for the iPhone. The best of these will cost money, and rightly so, but you can also search the App Store for free applications only.

Paying for new software is identical to paying for new music through iTunes, in fact, you can use the same account. Selecting an application to download is a two-step process and couldn't be easier. In no time you'll be tinkering with new, fun and productive applications for the iPhone.

Battery Life
The first generation iPhone enjoyed long battery life, mainly due to the lower power consumption of its EDGE network capability. The iPhone 3G faces the same battery draining concerns that Nokia has been struggling with since it released the N95. Our first full battery charge lasted only eight hours. We did use the phone heavily, including two hours of calling, 90 minutes of video playback, two hours of music and about an hour online, but for most people this isn't unreasonable usage over the course of a day. Also notice this list doesn't include any GPS usage, push email or Wi-Fi networking.

Subsequent battery cycles have been better, but not significantly — the best we've seen so far is just over 12 hours. Expect to charge the iPhone 3G at the end of each day and don't forget that when this performance decreases over time you won't be able to replace the battery easily.

Overall
The blasphemy must end: this is not the Jesus phone. The iPhone 3G is a jack of all trades, master of none. Its design and usability were revolutionary this time last year, and remain so. The iPod and the internal storage are outstanding, but we can't overlook the absence of numerous important features commonly found in the competition, let alone handsets available for a third of the price. The 3G speeds are average and the excellent GPS chipset is overkill without a decent navigation solution.

The App Store is the best service of its kind, but only further emphasises the functionality the handset is missing out of the box. It's true that most of the iPhone's missing software capabilities — no video capture, no MMS, no internet sharing, no accessible file structure — may be corrected by third-party applications in time, but this will only occur when someone other than Apple dedicates the time to developing these applications. Unfortunately, this may end up setting you back more money to cover what is otherwise commonplace smartphone functionality.

But our biggest concern is value for money. Forget everything Steve Jobs said about "the iPhone being affordable to just about everyone". Australia's three iPhone carriers are (unsurprisingly) intent on making as much money as possible out of iPhone customers, and the iPhone plans we've encountered range from eye-rollingly to mouth-gapingly expensive. For example, if you were previously on a AU$49 capped calling plan you can expect to pay an extra AU$20 a month for a similar iPhone plan, mostly to pay for the included data allowance, but without an increase in included calls and messaging. Then you need to add the additional expense of the iPhone itself.

If local iPhone pricing emulates what we saw in the US last year, we expect a price drop in two or three months. Until then, check your budget carefully before signing your life away, and make sure you have enough money left over to buy some decent headphones.