Via Daring Fireball, I found an amazing video of Steve Jobs from 1997 talking about his philosophy of business. This was after he returned to Apple, but before any of the iProducts (iMac, iPod, iPhone, iPad) which would make Apple what it is today.
The whole thing is worth watching, but the core lesson is captured in this quote:
...you’ve got to start with the customer experience and work backwards to the technology. You can’t start with the technology and try to figure out where you’re going to try to sell it.
The remarkable thing about this quote (other than the fact that he used "customer experience" over a decade before it became a hot buzzphrase) is that this is exactly backwards from the way almost every other technology company develops its products.
You could substitute the word "capabilities" for "technology," and Jobs' lesson would still be true, and it would still be backwards from the way many other companies develop their products and services.
Most companies (even startups) begin product or service development with the capabilities they have (or could quickly acquire), and try to find ways to attract customers by packaging those capabilities up at an attractive price. That favors inertia over developing a good customer experience. It can also lead to feature clutter, since the temptation is always there to include something "because we can."
The Apple approach, on the other hand, puts the desired end result front and center. Along the way, some compromises will inevitably have to be made where there are things which can't be done at a reasonable price. But by starting with the customer experience and working backwards, you keep the experience front-and-center during the whole development process.
So why don't more companies follow the experience-first strategy? My sense is that it's just hard. It's hard to stay focused on the end product, it's hard to say "no" to cool capabilities which don't enhance the overall customer experience, and it's hard to accept that a longer development cycle may be required if a critical piece of the puzzle doesn't exist yet.