They had cut quite a few corners when they first released the iPhone. It certainly wasn't suffering from feature creep. It didn't support 2G, video recording/playback, it didn't have a GPS etc. They have gradually added features after the initial release.
A phone that could also play mp3s AND browse the web AND play videos AND display photos AND... many would call that feature creep when it comes to a phone. Certainly more so than a device that can display text AND play videos.
