Their problem with execution was the plan of vertical integration that Apple is known for. In particular, there's little that the first iPhone could do that Blackberry didn't already do at the time - except for one thing. Cost. Blackberry was a victim of their success in the business market segment, and Microsoft wanted to join them there. The iPhones initial launch included a deal with AT&T to make it a relatively affordable, consumer facing device, thus expanding the market as a whole, to the success we see today.