The iPhone, like the iPod before it (well, at least since the 3rd-gen iPod, when Apple switched from FireWire), uses a proprietary connector called the dock for charging, syncing, video and audio-out, and multiple other functions. A broad port with 30 pins for many purposes, having a proprietary connector gives Apple a lot of flexibility, but also -- through their licensing program -- a lot of control over who can make peripherals and what can be done with them.
During our last edition of the iPhone Live! podcast, Dieter flat-out stated that Apple needed to dump the dock. He pointed out that countries like China and regions like the EU are, or may be, making universal connectors like USB a legal requirement. One charger, one port, to rule them all. (HTC is already replacing the 3.5mm headphone jack, folding it into the mini-USB-like ExtUSB on devices like the Android G1).
The dock connector originally allowed Apple to keep FireWire compatibility and add USB when it entered the PC market. Over time, Apple has moved over to USB, and now with the iPhone 3G and later iPod's, FireWire is gone completely and charging can only occur via USB. Since USB already provides power, provides data exchange, and technology like DisplayLink (which connects external displays via USB) show that an increasingly large range of connection types are becoming possible.
So, as technology marches on, as backwards compatibility is shed, and as standards like USB 2.0 (and in the future, USB 3.0) grow faster and more capable, is it time for Apple to dump the dock and go with the same port most everyone else is using (including Apple with the Mac)?