I am about to release my first app to the iTunes store. What version of the iPhone/iTouch should I be targeting to hit the most people?
The default in XCode is 3.0.
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OS 3.0 adoption is currently at about 47% (less among iPod Touch users), so I’d certainly recommend targeting 2.0 if at all possible.
Update: here’s an article with the statics (this one actually puts iPhone adoption of the OS at 44% and iPod Touch at 1%).