The Atlantic writes about how Apple’s launch of the iPhone forced Google to scrap their Android project and start over.

For most of Silicon Valley—including most of Google—the iPhone’s unveiling on January 9, 2007 was something to celebrate. Jobs had once again done the impossible. Four years before he’d talked an intransigent music industry into letting him put their catalog on iTunes for ninety-nine cents a song. Now he had convinced a wireless car­rier to let him build a revolutionary smartphone. But for the Google Android team, the iPhone was a kick in the stomach. 

“What we had suddenly looked just so . . . nineties,” DeSalvo said. “It’s just one of those things that are obvious when you see it.”

Android prior to the iPhone was scrapped when the iPhone was unveiled.

A lot was wrong with the first iPhone too. Rubin and the An­droid team &emdash; along with many others &emdash; did not think users would take to typing on a screen without the tactile feedback of a physi­cal keyboard. That is why the first Android phone &emdash; the T-Mobile G1 from HTC, nearly two years later &emdash; had a slide-out keyboard. But what was also undeniable to the Android team was that they had underestimated Jobs. At the very least, Jobs had come up with a new way of interacting with a device &emdash; with a finger instead of a stylus or dedicated buttons &emdash; and likely a lot more. “We knew that Apple was going to announce a phone. Everyone knew that. We just didn’t think it would be that good,” said Ethan Beard, one of Android’s early business development executives.

Within weeks the Android team had completely reconfigured its objectives. A phone with a touchscreen, code-named Dream, that had been in the early stages of development, became the focus.

The Android team did not believe a touchscreen would work, until they saw the iPhone. The author is mistaken to write about touchscreen on iPhone being something wrong with the iPhone. As John Gruber puts it:

That first sentence is fine — the original iPhone left much room for improvement. But Vogelstein’s supporting example — the on-screen keyboard — is an example of something the original iPhone got right, and which took the rest of the industry, including Andy Rubin and the entire Android team at Google, years to come to terms with and accept. What percentage of smartphones sold today have a hardware keyboard? I’m guessing it’s in the single digits and dropping.