The fact that it's not waterproof really dampers the idea...
One of the nice things about having a Gopro or a Contour is that if it breaks, you're just out of some footage. Buy another $2-300 camera. If you break your iPhone, not only could that impede your ability to call for help, but you're looking at $500+ to replace it. Not to mention the fact that the iPhone isn't expandable, and doesn't have a replaceable battery...
While I think it meets the "action cam needs" of probably 90% of the people who use them, and does so at a lower price point, you should definitely educate yourself to the benefits of a real action cam before you commit.
P.S. I got my Contour ROAM 1080P30/720P60(firmware downgrade/hack) action camera for $90. No changeable battery, but waterproof without the big bulky case of a GoPro, and MicroSD storage. And if it breaks, I'm only out $90...