If apple think their iPhone success shows that people like closed systems, they are kidding themselves. Phones have never really been open (thanks to the carriers), so the iPhone was actually one of the more open phones out there. But once they start competing with actual computers, it is going to be very different.
The Newton, just like any other tablet computer had a niche, vertical applications.
And it failed in that niche because of choices set in stone by the Apple team that developed it.
It wasn't open enough.
So, forward 21 years and we're in 2010, where we see a sequel to the Newton, running a proprietary OS on hardware that has been closed to the point where you can't even attach a USB stick.
I'm sure that lots more of these will be sold than there ever were sold of the Newton, but I doubt it will tap the potential of this form factor. For that it needs to be much more open and hackable.
This is just another remote terminal attached to the web, and more importantly for Apple, to itunes.
There is nothing wrong with remote web terminals, but as long as they are computers you should allow access to all that power, locking it and making it hard to put software on it is limiting, not enabling.
Apple and Nintendo aren't young start ups; they've been around for decades with closed systems. A closed system like iTunes is a big reason Apple has even gotten so successful in recent times; it works I.e they have made tons of money with a closed sys and they probably will continue to do so. Marketshare is another story.
Whether it makes geeks happy is also another story
The elephant in the room is the iPhone, where "circle of one" seems to be working extremely well. Maybe the model just needed some fine tuning.
All of those issues are precisely because the Macs were proprietary. If they hadn't been proprietary, none of the issues that made them lose to PCs would have been issues and they may have won the war. In the 80's, every school bought Apple IIe's, so they had the foot in the door.
Then, under the leadership of Mr. Jobs, apple slammed the door shut on their foot and here they are doing it again -- also under Steve Jobs.
Steve is the problem. Eventually, they'll realize this and fire him again when people get tired of his antics.
Going back to the subject, before Steve came back Apple tried the MS game where they licensed everything about the Mac (from hardware to software). This strategy failed miserably; most likely because they were already too late.
Fast forwarding to today, Steve is not the problem. He is the main reason Apple is wildly successful today. If he didn't return and revive Apple with the products under his watch, Apple would most likely be gone. Saying Apple is not successful is like saying BMW isn't successful just because it doesn't sell as many cars as either Ford or GM.