Let’s assume Apple doesn’t wisen up and correct their mistake here.  What’s going to happen is history will repeat itself.  The whole point of the App Store was to appease customers who desired their iPhone to do more than just what few apps Apple included.  They were doing this on the 1st gen iPhone with the help of jailbreaking utilities.  They were also using the jailbreaking method to use their phones on different networks.  Apple’s response was, “Ok, we hear you… here’s the iPhone SDK and App Store.”.  So now users and developers alike are all overjoyed, and the App Store is instantly successful.  Users are happy, developers are earning money, and Apple’s revenues are up.  Now the current controversy ensues.  Developers are afraid to invest their time in developing an app that might not be accepted into the App Store.  There are no guidelines for whether or not it will be accepted.  They will not find out whether or not it will be accepted until the app is complete, meaning all development is done and time is already invested.  Would you do work, expecting to get reimbursed for it, but not knowing whether or not you would until it was finished?

Like I said, history will repeat itself.  If Apple continues this pointless charade, users will go back to jailbreaking their iPhones to get the apps they want.  Developers will find other ways of distributing their apps.  It won’t be as beneficial to everyone as the App Store, but people will not stand to be censored.  When you buy something, that something belongs to you.  Nobody likes to be told what they can and cannot do with their own personal belongings.

I have no idea why Apple is kicking themselves in the nuts over this.  How does it help their bottom line?  They’re losing money over this, and for what?  Pride?  Image?  Apple is getting away with this for now because of their cult-like following, but they’re pushing their limits.