I currently have 975 songs on my 8GB iPhone which is 6.21GB. I do have some progressive rock songs on there though which go up to about 30 mins in length and I have ripped all my music using EAC + LAME which also makes a difference to file size. I probably could fit 1,000 songs or more but I have left some room for 500MB of Audiobooks and some room for a couple of podcasts.
Start chucking movies on there at about 800MB each then it really does use memory fast. For an every day device where you don't need loads of music it is great. I use my iPhone everyday. However, on a long trip somewhere my 80GB iPod still cannot be replaced. It also really depends on how much music you have. I am sure the majority of people will happily last on a few hundred music tracks, a couple of audiobooks and a couple of movies. Everyones mileage may vary. If I didn't have my iPod though I would be very happy with just the 8GB on my iPhone, I would just need to think about what I take rather than just chucking everything on.
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