You put it up to your ear and the screen goes blank. Turn it on its side, and the screen rotates. Walk outside and it can find your location, point a compass in the correct direction and post your geostatus on Google Latitude. Point it at a Twitter user in the real world, and you can see his or her status on a pop-up screen.
While not every feature on the iPhone is unique, the way Apple has implemented some of those features is. And the iPhone serves as the base for tens of thousands of third-party applications, many of which make use of its built-in features in innovative ways.
Although Apple wouldn't comment on this story, preferring not to divulge too much about how the 'magic' works, we've dug around and compiled information from various sources.
To take a closer look at how some of the technology inside the iPhone works, read on.
Screen coating protects against dirt
Earlier generations of the iPhone were dirt magnets, leaving the screen smudged up after normal use, but the new iPhone 3GS has a protective coating that wards off oily grime. Amazingly, it works -- the 3GS is relatively smudge-free, although it does still pick up dust easily.
Gizmodo, a gadget blog, posted a helpful description from Bill Nye the Science Guy about the oleophobic coating that Apple engineers stuck on the new model's glass. It is an anti-bonding agent, similar to car wax sealants that cause water to bead, rather than pool, on your car's roof, Nye explained.
The same effect happens with Apple's polymer coating, preventing the grime from bonding, building and leaving telltale smudges behind.
Screen dims when iPhone sits idle for a while
A sensor on the iPhone likely uses infrared to automatically save power.
When you have not used your iPhone for a while, the screen dims to save power. In addition, as you use the phone, brightness adjusts depending on whether you are in sunlight or darkness.
Don't think this is just a timed event based on an internal clock that knows when the sun goes down -- it's not. The iPhone uses an ambient light sensor, describes The New York Times' David Pogue, in an illuminating 2007 column.
Light sensors scan for electromagnetic intensity. On the iPhone, a chemical-based photocell changes its power setting depending on an infrared reading. A photocell is better at reading environmental data than a simple on-off light sensor you might have installed above your garage -- photocells can detect sustained differences, knowing when you have just passed your hand over the sensor versus entered a dark room or walked outside.
On its iPhone site, Apple has revealed some clues about how the touch screen works. A panel under the screen glass senses your touch using an electrical field. The panel then sends this reading to an LCD below it.
In other words, your finger changes the electrical charge, which in turn feeds the phone operating system and determines which pixels have changed and which activities have been triggered.
Every touch screen phone uses a similar method, but what makes the iPhone unique is how the iPhone OS responds so quickly to swipes, pinches, and finger presses -- so fast that there is a burgeoning market for high-quality iPhone games that some say rival even the mighty Nintendo DS and PlayStation Portable.
Proximity sensor blanks screen automatically
When you move the iPhone to your ear, it automatically blanks the screen. This saves battery power, since you don't need the screen while talking on the phone (normally), and it also prevents you from touching an onscreen key -- such as the one to end a call -- by mistake.
Based on our own hands-on testing with the device, there are at least two (and possibly three) infrared sensors located near the ear speaker. Like most proximity sensors in smartphones, the iPhone sends out an electromagnetic field that scans for obstructions in an area about a half-inch away from the phone. Test this by placing an object over one of the sensors. The screen will go blank, and then reappear when you move the object away.