So when cell phones don't work when you want them to work, spontaneously combust, and don't allow you to have your privacy, what do you expect cell phone manufacturers to do? Diversify
the cell phone's functionality! How else are those darn companies supposed to direct your eyes off of the negatives??
On a serious note, convergence seems to be FINALLY arriving (after being predicted for what, 5 years?). This is a good thing, but there will be a major shake-out in the various product markets that make up what will be the final converged market. Smart phones already seem to be the sole reason why PDA sales have plateaued and you can bet that something similar will happen with digital cameras as soon as the technology for cell phone cameras gets good enough to displace traditional digital cameras. Storage will be a non-issue, it's expected that storage will become cheaper, more power-efficient, and have smaller physical footprints; although how long this actually takes to come to pass is up for debate. The bigger issue is power management when you're talking on your cell phone, that eats up a LOT of power.
As storage space gets up there, the MP3 player market will likewise downsize, it's only natural. Apple's doing a great job with their iTunes strategy to complement iPod sales, but this complementary goods and services strategy can only last so long, especially when you have standalone legal download options like the new Napster, RealRhapsody, and TELUS Puretracks, among others. We'll end up with convergence in the mobile market. Seriously, would you rather be carrying three devices (a cell phone, an MP3 player, and a PDA) or one device with the functions of all three? It only makes sense that convergence is the future for the mobile market.
Remember, you read it first or for the hundredth time here.