I have recently become hooked on the Hipstamatic app for the iPhone and take a lot of personal photographs with it. The app recreates the look of toy film cameras which became popular with photographers looking to create something different. Toy cameras often have plastic lenses and poorly fitting backs, this results in light leaks onto the film and grainy soft focus images.
My verdict is you can certainly take some interesting photographs with the app, but the quality isn’t going to hold up when printed. I don’t think Canon have too much to worry about at the moment.
I set the “film” to BlacKeys Supergrain and the lens to John S, I haven’t done any processing on the images, this are exactly as it looked straight out of the iPhone. The reception venue was very dark and I was working at 3200 iso on my Canon 5DII, the iPhone still managed to capture some usable images.