They will have to approach it in a different way, and some genre’s will never be really good on iPhone (and aren’t meant to be played on that platform, imho). But other stuff can be as great as any other place. Look at Edge, Peggle, Monkey Island, iBlast Moki, Soozis, Infinity Gene, Doodle Jump, Orbital or Flipt.

Less buttons (or no buttons) is a drawback, but so is only being able to do one or several things, but not everything (iPhone does it all, and you ALWAYS have it with you)

There are many elements that go into a game other than the controls. As other here have stated, for iphone to compete, it has to stick to its strengths, which their happen to be many of them. Physical buttons doesn’t happen to be one of them, however convenience and price are 2 ‘hard-hitters’ when it comes to games, not to mention that the iphone does have touch screen and accelerometer support to help the controls out.

Also, there are many various demographics for videogames, the Wii and 360, for example, generally do not share the same as each other. In the same way, the iphone hits a different general audience than console games and because of that is able to compete.

On the other hand when game developers focus on the strengths of the touch screen and not on the drawbacks of no face buttons some unique titles are born.

Anyone who has played Flight Control knows what I’m talking about, that game is amazing and impossible on other systems.