A controller for the iPhone ... or bust
One big issue is getting approved by Apple -- in order to run a peripheral that actually connects to the iPhone hardware, the project will have to be approved in the "Made for iPhone/iPad" program, and that's been the biggest obstacle for developers so far. But Morisse is working on that already, along with iterating on product designs, so hopefully he'll accomplish that goal quickly.
In the meantime, we'll wait and see. There's certainly a demand for such a device at a reasonable price -- Steve Jobs may not like buttons, but most gamers do, so the first actual production device to go on sale in this market will probably find plenty of buyers.
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