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The iPod Touch and iPhone 1.1.3 is ready for installable applications.

- SpringBoard doesn't need to be changed through Summerboard to show the extra applications in the /Applications folder.
- All applications run as 'mobile' instead of as 'root'.
- Preferences are now stored in '/var/mobile' instead of /var/root.

There is currently no other application available for purchase other than the iPod Touch's $20 software package, but the installation architecture seems to be ready. Apple could release more software for sale, or for free if they want.

To make it easier for developers to make programs with he SDK, the frameworks have gone through many changes. These changes will make some applications not work with the iPod Touch, but developers can update their applications as needed, when the SDK comes out near the end of February.

Source: Nate True
http://cre.ations.net/blog/post/iphone-113-firmware-behind-the-scenes-changes