We've all heard huge numbers thrown around as measures of iPhone and iPad App Store success -- over 200,000 apps and 5 billion downloads being some of the most recent and most impressive. There's a couple of other numbers that are even more interesting when it comes to iPhone and iPad development: 100, 100 million, and 1 billion.
Roughly 100 million iOS devices have been sold to data and they are all broadly software compatible. There's some fragmentation to be sure -- older devices are slower, there's no cameras (yet) on the iPod touch and iPad, no GPS in iPod touch, iPad Wi-Fi, and the iPhone 2G. Apple mitigates this somewhat by offering services such as CoreLocation where, if no GPS is found, it gracefully degrades down to cell tower triangulation or Wi-Fi router mapping. Even the iPad with its odd-device-out 1024x768 display will frame iPhone apps or pixel double them, which is awkward but still workable, still compatible. When iPhone 4 ships, it will be precisely double the vertical and horizontal pixel count of previous generations, meaning older apps will simply look the same as they did before (using 4 pixels in the space they used to use 1).
Likewise, most iOS devices tend to get updated to the latest version of the OS, or at least fairly recent versions. While iOS 4 will drop compatibility for iPhone 2G and iPod touch G1, it will also be free for all other devices for the first time, ensuring iPod touch G2 and G3 owners are more likely to update.
Everything isn't perfect, but for a vast majority of apps it doesn't need to be. They just work.
The sheer size of that install base is stunning. Code an app once and deploy it to a theoretical 100 million devices -- and growing -- all with a drop-dead-easy to use icon on the home screen to help them get your apps?