The iPhone's relevance lies not in its convergence of phone and iPod or even the mobilization of OS X, but that it's the first-ever, mass-market computer with a third-generation UI.

Here's a link to a UI technology demo that combines everything: multi-touch, gestures, physics, 3D and icon minimization. Fasten your seat belts, if you haven't seen it. This demo makes Jobs' keynote look as boring as, well, a Bill Gates keynote: Perceptive Pixel founder Jeff Han tomorrow's UI at the TED Conference in February 2006.

In addition to the five UI elements, this demo also shows the hardware elements required to use it comfortably: A "drafting table" screen that's low and at a comfortable angle; a large touch screen; very powerful 3D graphics hardware; high-performance file retrieval; and massive, raw processing power.

Breathtaking, isn't it? The best news, is that you'll soon be able to buy a tiny one from Cingular.

But will the desktop version of this third generation UI come from Apple, or Microsoft?