Think of it like VHS vs. Betamax. "Everyone" says Betamax was technically superior, but often forget that it debuted with only a ~1 hour recording time, making it completely unsuitable for movie watching. However most users wanted to be able to watch movies. So even though it was only technically inferior in one aspect, that aspect was so important to the majority of users as to make VHS a significantly better system.
The same thing is happening here. A lot of people who live in big cities now depend on their phones for directions, and a lot of them need transit directions in addition to driving directions. A phone that can't do that has greatly diminished value. Not everyone wants a phone as a status symbol: some want it to actually do useful things.