When Apple unveiled the iPhone what seems to be oh so long ago, Steve Jobs stood on stage and said that Apple would consider the product a roaring success if they managed to capture something like 1 percent of the global smartphone market before 2008. Now, numbers indicate that sales of the iPhone are so brisk that Apple’s device will capture approximately 10 percent of the US smartphone market this year.

[ Strategy Analytics: Apple to grab 10-percent of US smartphone market in 2007 ]

How this really translates to the global smartphone market remains to be seen, but it would certainly indicate that the iPhone made the splash that everyone expected it to, flaws or no. The iPhone certainly does have some serious flaws, many that would be a deal breaker for many smartphone users – I know several smartphone lovers who will likely stick to their Treos and Blackberrys and Nokias until Apple opens up the platform to developers who will provide apps that let them do the things they need to do. Sure, there’s a world of third party apps available for the iPhone that run through Safari, in the sandbox of web apps and services that Apple’s prescribed, but personally I have no doubt that as the iPhone matures as a platform, we’ll see Apple slowly but surely pull the veil back.

Apple has always been fanatical about keeping its environments tweaked, sandboxed, and optimized for their software and their tools; it’s no surprised that Apple wants to wait until they separate the success and performance of its device from the impact that any third party apps will have on the device before allowing those apps on. Apple wants the world to know the iPhone kicks ass before a third party developer makes a must-have application that slows it to a crawl or causes a problem on the device.

That all being said, and back to the 10-percent point, this news makes you wonder whether people are picking up the iPhone in addition to another cell phone, whether they’re leaving their service providers for AT&T in droves to get one, and whether the people getting the iPhone are moving away from other smartphones (which would mean Apple’s taking customers away from the Nokias and Blackberrys and Palms of the smartphone world) or whether these people are first-time smartphone buyers (in which case Apple is expanding the overall smartphone market). That remains to be seen, but Apple can’t be unhappy with the sales numbers from the iPhone’s opening weekend:

[ iPhone Weekend One: 700,000 Sold, $200million+ Profit For Apple ]

So happy, that it rumors have arisen that Apple is readying a smaller, lighter, and cheaper iPhone based on the iPod Nano. What this means is still up in the air and subject to speculation: is Apple ditching the iPod for the iPhone? Will there be more iPhone models? Will this one be on multiple carriers? No one knows yet, and Apple isn’t saying a word.

[ JP Morgan: Apple Plans Cheaper, Nano-Based iPhone ]

Yesterday on Marketplace, there was an amazing story about the practice of “gold farming” and item trading in massively multiplayer online games. They focused specifically on Lineage 2, probably because it’s very popular in the country they visited to learn about the practice, South Korea. In Korea, as the story says and is totally true, gaming can be a professional sport, where televised tournaments make stars and heroes out of gamers who are cheered by adoring fans. Commentators call the moves in the game with fervor, and people treat video gaming, especially multiplayer games like Starcraft, with all of the reverence and respect that Americans treat baseball or football. And in many ways, rightfully so.

The best part of the story is the fact that it takes a serious look at the practice of trading virtual items in many of these massively multiplayer games, like epic weapons and difficult-to-obtain armor and objects, even virtual currency like gold in World of Warcraft (my MMO of choice), for real money. The reporter heads to Korea, the birthplace of many of these trading sites, and the home of many services and people who profit from and participate in the trade, what many of us refer to as “gold farming.”

The story was fantastic, aside from the journalist’s in credulousness that such a thing could possibly happen, but he handled it very very well. I would object to the notion that the items in the game that are being sold “don’t exist,” with the subtle notion that if it’s not tangible and real then it’s not worth anything – people pay for license codes and virtual material all the time and none of that “exists” either; people pay for access to products and services that are completely virtual and online, but none of that technically “exists.” I don’t see that as much different, so it was a weak end to an otherwise great story. I’m more impressed that Korea has an entire government agency devoted to the online gaming industry, which I suppose you have to have if your citizens enjoy it (and some of the best broadband internet access in the world) as much as Koreans do. What also surprised me was that there was an entire industry lobby of companies that profit from item trading and the activities of gold farmers to oppose the interests of the game developers and designers. It was an amazing listen, and the transcript is just as compelling. Check it out!

[ Online 'Gold Farming' More Than A Game ]