Remember they were literally defining everything at the beginning - OS, UX, APIs, core features, hardware, first party apps, market positioning, etc etc. Needs of third party developers weren’t nearly as important as nailing the basics and ensuring a risky project was a success. The html5 app bit was a way to test the waters for developer interest and demand but very much an interim solution.

Jobs’ hot takes aren’t the end-all when it comes to product intent at Apple. He was basically an embodiment of strong opinions weakly held. His superpower was focusing teams on what the right set of features would be to create a product that made sense to the market, and ignoring everything else. The phone / iPod / internet communicator trifecta was example of this - nothing but nailing those three mattered at launch, and any effort elsewhere was wasteful. Without that kind of leadership, eng teams will often dither efforts over many things that don’t matter to success.

The history of Apple is filled with examples of this dynamic. iPhone was a group effort among many talented and influential people and I doubt Forstall and others driving software had same opinion on third party apps. They just didn’t pick that battle before it made sense to. Every other computing platform at the time (including Windows Mobile, Palm, and BlackBerry) supported third party apps, it’s not like the use case was novel or difficult to see, and the webs limitations were considerable. Adding apps was a default path temporarily set aside.

-W