Flip filled a convenient niche for a few years until the 3GS came along with video support, after which it was useless for many consumers. This was the only reason I bought a Flip, and the only reason anyone else I know with one did.
Similarly, I think the first mainstream smartphones to record HD video wasn't until 2010. Again flip had a small window with their HD models before cellphones killed them again.
At least GoPro have (had?) a good story around their mounts and waterproofing, there was nothing in my opinion a Flip did that cellphones didn't very quickly do better.
