Steve was probably very correct here. The thinking at the time at places like RIM was that the iPhone would not technically work -- even after they saw it. Capacitive displays weren't ready. A full screen display would drain the battery. On-screen keyboards were unusable.

The great thing about "yes, if..." is that the discussion continues. People drill into the "if". "No, because ..." tends to end the discussion. "Oh, that will drain battery life? OK, lets not consider this any further."