My iPhone is only 8GB so cannot hold all the music I have, and using it as a wifi music streamer kills the battery.
Do you really need that much music?
I once had a collection of over 100gb, came to the conclusion I was downloading for the sake of it. Out of all that how many songs did I actually listen to.
Now just have the songs I actually listen to which is about 250-300 and no where even near that many GB.
As for others 3.5mm jacks are standard and have been for several years. UI again since smartphones has been great. Battery mp3 playing takes nothing and phones just playing music lasts ages.
Size I can certainly see the the appeal of sense clip, iPod nano/shuffle.