That's an easy one ... they can reject your application (it says so in the SDK agreement).
See Google Voice for such an example. Or ask any iPhone developer that's been playing this game for a while ... you would be a fool to drop an app in the App Store with lots of functionality, the more there is to use in your app, the more likely it is to get rejected. That's why people are doing incremental upgrades ... at least if a new version gets rejected, your lost investment isn't that much.
And the more frequently you drive in your car the more likely you are to have a fatal accident. The more frequently you fly in an airplane the more likely you are to die in a plane crash.
Many people drive in their cars every single day without dying in an accident, and many people fly nearly every single day for business without ever dying in a fiery accident.
No one hears about the companies doing extremely innovative stuff on the iOS platform because they're not complaining. Look at TapTapTap and the apps they've built and how imaginative and beautiful they are. They've made millions of dollars with just a handful of people working on their apps. Take a look at Smule and the Ocarina app they made that lets you blow into the microphone and play your iPhone like a flute. Really innovative and killer apps that are in the App Store, now, available to purchase.
You can build incredible, mind-blowing, futuristic apps for iOS without getting close to any of the provisions in the Terms and Conditions. The article's main premise is that "killer apps" go beyond what Apple allows you to do with iOS but that's bullshit, anyone can build a killer app with what Apple gives you.
See Google Voice for such an example. Or ask any iPhone developer that's been playing this game for a while ... you would be a fool to drop an app in the App Store with lots of functionality, the more there is to use in your app, the more likely it is to get rejected. That's why people are doing incremental upgrades ... at least if a new version gets rejected, your lost investment isn't that much.