I think if you think back to 2007/8 and people had the choice of Android with millions of apps and a higher priced iOS ecosystem which only has some high profile apps so few people would choose iOS that it would quickly become a waste of money for FB/Twitter/MS to build their apps for it and it would die.
There was no App Store for the first year, which I believe is a time when Android didn't exist. An app-less iPhone would not be able to compete with an app-store backed Android.
