iPhone SDK - The iPhone SDK, or Software Development Kit, is a software development environment that allows developers to write programs that can be installed and run natively on the iPhone.
When it was first announced, the iPhone allowed for the development of web applications, but not of programs that users could install on the phone itself. Developers eventually cracked the iPhone's security and began creating their own iPhone apps, with various responses from Apple.
Apple announced the iPhone SDK in October 2007. The SDK is expected to be released in Feb. 2008.

