This video is from late May 2007, a month before the launch of the iPhone.
Buried in the Q&A section, there is this interesting statement about what would become the App Store. Starts at 49:50.
Question: Brian Dear from Eventful. Steve, all indications so far are that the iPhone is like you say, a beautiful piece of software wrapped in a beautiful piece of hardware.
Steve: Oh, thanks.
Brian Dear: And the fact that it’s running on OS X is a fantastic development. I think I would speak for many developers, perhaps thousands of independent developers who would love to write apps for that platform ’cause I believe it’s gonna be a tremendous platform for the future. But the indications are so far that it’s closed. If you could comment on that, and do you see it opening up for developers in the future?
Steve: Sure, it’s a good question. This is a very important trade off between security and openness, right? And what we want is: we want both. We wanna have our cake and eat it too. And so we’re working through a way… we’ve got some pretty good ideas that we’re working through. And I think some time later this year we will find a way to do that, because that is our intent.
Walt Mossberg: Find a way to open it up so that third party developers…
Steve: Find a way to let third parties write apps and still preserve the security.
Walt: But at the start until you get that in place…
Steve: Find a way… we can’t compromise the security of the phone. This is something that you have to…
Walt: Is this a network issue, is this an AT&T issue? What, when you say the security of the phone?
Steve: You know, I won’t mention names, but I’ve used, we’ve all used a lot of smart phones that crash more than once a day, and with the number of third party apps you put on them, the more they crash. And we don’t… we’re gonna… nobody’s perfect, but we’d sure would like our phone not to crash once a day or more. And so: We would like to solve this problem. I think we’re going down some really good avenues to do it. If you could just be a little more patient with us I think everyone can get what they want.
The question is about native apps like on OS X, and Steve confirms that they’re working on it, and that they want to lock down the platform.
At the WWDC Keynote in June 2007, just a few days later, at the end of the Mac-centric keynote, Steve did the spiel about the “Sweet Solution” for developers on iPhone, HTML Webapps in Safari. Starts at 1:13:20.
The real SDK wasn’t finished, and Steve’s slide says, there is no SDK, spinning it as something good.
Forstall even admits at the end of his demo that they had to look for some kind of a developer story for WWDC, while they were secretly already working on the real App Store that would launch one year later in the summer of 2008.
I think this shows that the narrative that Steve had to get convinced to let third party developers make apps very late in the game, and that the iPhone OS SDK and the App Store were not planned from the start, is wrong. The “Sweet Solution” was a classic RDF by Steve. The SDK simply wasn’t ready for the launch in 2007.