Will you buy iPhone

As expected Apple announced phone version of iPod which will debut the market six months from now with a initial price tag of $499(4Gb model),$599(8Gb model) and cingular as the service provider.They also renamed the company as Apple Inc and they increasingly becoming Media and entetainment company where apple already distinguished themselves with innovative iTunes service.
Apple already controlling 75% MP3 Market in US and this new model could also take off well 'coz loyal iPod fans.But i am little skeptic about this hype and hoopla.
1)Isn't $499 too much for phone?
2)It may start off well but apple has to find a way to exercise price tag in the Version 2. like it did in iPod's case.
3)Is zune Microsoft's much hyped yet modest can bring new features and innovation to the market rather than staying copycat?(As Microsoft palnning Europe launch of Zune in the end of 2007)
4)May be by Q1 of 2008 market will be crowded with iPhone clones from handset leaders like Nokia,Motorola,Samsung and ericsson.
5)Will apple allow 3rd party applications,accessories for iPhone?If yes,that could change the landscape of closed game of hand set-service provider.
Apple really have tough game ahead to play it seems.