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    <p>The iPod touch is missing:</p> <ul> <li>GPS</li> <li>Bluetooth <em>(iPod Touch 4G has Bluetooth)</em></li> <li>Cellular network</li> <li>Camera <em>(iPod Touch 4G has front and back cameras)</em></li> <li>Microphone (thanks <a href="https://stackoverflow.com/users/1450/john-topley">John Topley</a>) <em>(iPod Touch 4G has headset with microphone)</em></li> <li>Vibration</li> <li>The 1G is lacking a speaker</li> </ul> <p>On the plus side it weighs a bit less and is a bit smaller.. Other than that they are pretty much identical (no sarcasm here; it still has the same processor, OS, control system, and display) Personally I would get an iPhone, as you will probably end up getting one later on anyway. I have an iPod touch (bought first) and an iPhone. I never use the iPod anymore.</p> <p>The iPod touch is obviously cheaper than the iPhone, and there is no contract necessary. However, at least in the UK you can get a contract-free iPhone, and you should be able to do so soon on AT&amp;T in the USA. </p> <p>There are no extra costs besides the $99 for application development (which is a yearly fee)</p> <p>We are developing from the UK. One issue to be aware of when you eventually sell your application is tax withholding - Apple will retain 30% of your revenues. There are some forms you need to fill out - I dealt with this in <a href="https://stackoverflow.com/questions/124093/tax-on-iphone-developer-payments#127200">another thread</a>. Here's what I wrote there:</p> <p>You need to fill out a <a href="http://www.irs.gov/pub/irs-pdf/fw8ben.pdf" rel="nofollow noreferrer">W-8BEN</a> and give it to Apple to avoid a 30% tax withholding. This requires that you have a SSN (Social Security Number). If, and only if, you do not have an SSN, you may supply an ITIN (Individual Taxpayer Identification Number) or an EIN (Employer ID Number). </p> <p>To get an ITIN, you need to fill out form <a href="http://www.irs.gov/pub/irs-pdf/fw7.pdf" rel="nofollow noreferrer">W7</a> and submit that to the IRS.</p>
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    1. COThe iPod touch has no microphone and can't vibrate, either.
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      1. USJohn Topley
    2. COactually I believe the processor in the ipod touch is a tad faster than the iphone (maybe not any more, now the 3GS is here)
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      1. USfrankodwyer
    3. COThe iPod touch 2G and 3G have speakers.
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      1. USSophie Alpert
 

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