What The iPad Can Do That Your Smartphone Cannot
We will start by mentioning that the following section also includes instances where the iPad simply does something in a far superior way than your smartphone, but even in those cases, we think it's worth noting this higher level of functionality as a point in the iPad's favor. Let's start with one of the more basic capabilities of a smartphone: surfing the Web. The iPad crushes every smartphone we've ever used in browsing the Internet. The 1GHz A4 paired with the already excellent (albeit limited by its inability to handle Flash) Mobile Safari browser makes for a strong browsing device. The best phone browsing experience we've had to date is on the iPhone, but the iPad puts even that to shame. Pages load far quicker, there is more screen real estate, and more sites are actually usable on the iPad than the iPhone. There's really no question here: the iPad can browse the Web way better than whatever smartphone you currently have, but unlike your phone, the iPad cannot easily fit into your pocket. But of course, Steve doesn't say that the iPad will; he says it can fit between a phone and notebook, and in times where your notebook is just too big or inconvenient to get to, the iPad is a huge step-up in the browsing department compared to your next-best option as of a few weeks ago.
Mobile Media Maven -
Secondly, the iPad can stream full-res online media in a way that the iPod, iPhone or any other phone cannot. The larger screen just puts the phones to shame, and the 1GHz A4 processor handles even the most demanding HD media files with ease. It's basically the bedside media viewer that you've always wanted, and it's way easier to grab than your full-size notebook. Plus, it'll play videos for 8-10 hours on a single charge; let's see your MacBook Pro (or any other notebook) do that.
Cracking The Books -
The iPad is an ebook reader obviously as well. Despite the fact that the LCD isn't quite as easy on the eyes as an E-Ink display (like the one used in Amazon's Kindle), it still offers a great reading experience. Your iPhone can display ebooks as well, but let's face it: you don't want to read a novel on a smartphone. The screen is just too small, and you waste too much time pinching and zooming. Reading books on a smartphone is a pain; reading books on a notebook is cumbersome. Reading books on an iPad is enjoyable.
The App List Lengthens as Does Battery Life -
The iPad is also more engaging in apps. The iPhone has loads of apps to choose from, but all of them share one main limitation--they have to be used on the iPhone's small screen. Compare that to the iPad's 9.7" panel, and you'll see that developers have far more screen real estate to get creative with. There's already been an iPad DJ application that shows two mixers and a number of toggles on the screen; that would be impossible to accurately use on the iPhone's screen. TweetDeck also works better with more pixels. The list goes on and on. The fact of the matter is that more screen space allows for more interactive and less limited apps, and the App Store is the iPad's bread and butter.
Finally, the iPad lasts for 10+ hours. The battery in the iPhone, and most every other smartphone, is lackluster. Even if you never make a call, and only use apps, 10 full hours of use is a stretch. The iPad can easily last 10 hours when used, sometimes more if you use it lightly. It makes sense, though; the iPad has two iPhone batteries working in tandem (basically, anyway), so that's certainly a plus.
Now, onto the comparison between the iPad and your notebook...