Bear in mind, the iPhone running a fully capable desktop class browser was jaw dropping. BlackBerry management were absolutely convinced the demo must have been faked. It's only when they got hold of actual devices that they realised it was genuine and even then it took a while for it to sink in just how far behind they were. It took Microsoft almost 3 years to figure that out.
This is often discounted because it's not obvious to the user unless you're familiar with specific aspects of the technology, but in terms of the capabilities it enables as a founding technology it's night and day. This is why Android ate their lunch as well. Although it was started as a BlackBerry clone, the fact that it was a full Linux kernel under the hood positioned it to become a solid platform for networked, isolated, fully memory managed, pre-emptively multitasking background OS services, and isolated user applications, with modern power management.
BB, Palm and Pocket PC were hobbled legacy platforms that might superficially emulate the UI of a modern smartphone but could never actually function and compete at the same level.
