EDIT: Apparently saying something that goes against the current on HN will start a shit storm (downvotes, obviously).
IMO, to build a successful smartphone that is appealing to the average user, that smartphone will require a base of desirable applications.
I see basically two routes to attempt to achieve this:
1) Build a phone that is so desirable to average users that app developers will find it profitable to develop for it (eg, iPhone).
2) Build a phone that is so desirable to developers that many will pick it up regardless of the profitability of the market. Then hope that these apps are of sufficient quality/desirability that they become part of making the phone desirable to average users.
#1 is incredibly difficult to achieve right now due to the maturity of the market, with two major players. Even Microsoft is having a tremendous amount of difficulty with this route. For Canonical, I believe it would be effectively impossible.
With #2, getting to step 1 (modest developer adoption) is easy. Where it often breaks down, is in getting the developers to build apps that aren't just appealing to them (eg, more terminal apps, more ssh apps, more special purpose tools that appeal to geeks, etc). But modest developer adoption is better than no adoption at all, perhaps?
I honestly don't see Canonical having much success with this at all, but I don't think avoiding apps that are appealing to coders will help in their case.
Your logic is broken there somewhere.
In fact he specifically said "I fail to see how this will make the Ubuntu Phone more appealing to the average user." shortly followed by "my point was that this will remain a niche phone."
-Edit to remove somewhat unnecessary snark-
I don't think 'your logic is broken there somewhere' is all that snarky in the grand scheme of things, in fact it's a pretty clear statement of fact. The two things "terminal apps are not appealing to average users" and "this phone will remain niche" are absolutely not logically connected.
Since you can assume that the terminal will be never or very rarely used by average users you can make the advanced functionality available as command line applications and leave the most basic/common options in the GUI.
A naive user is far more likely to check a box and click apply by accident than they are to type "rm -rf /".
A good example is a modern version of Windows, the control panel is full of options,tabs,checkboxes etc that can do weird stuff to your system and consequently make it harder to use because (until recently with powershell) windows has never had a useful commandline.
Step 1: Get coders to use your device.
Step 2: Coders want their own apps to run on their own device, so they port them.
Result: Now your device has lots of apps and you've removed one of the most significant barriers to normal people using it.
So they should really prioritize that part. Leave the developer/geeky stuff for later.
If these really just acted like little linux boxes wouldn't that be a huge plus for corporate support? Being able to SSH into these phones to install VPN or other default applications instead of forcing the users/ui to see them? What about being able to 'flash' a corporate phone to a default install or manage permissions?
shrug just a thought