The first photos I took with the iPhone were pretty mediocre. I thought the 2 mega-pixel camera was at fault.
A year after the iPhone was released, Apple opened up the iPhone to software developers. The result of that was a slew of photo applications created for the iPhone.
The first photo application I bought was Camerabag. That application transformed by photography with the iPhone. Camerabag's Helga setting replicates the look of the Holga or before that, the original Diana toy cameras.
It increases contrast, does some vignetting and crops your image into a square format. Everything the Holga does but without the light leaks.
My second most favorite app is Tiltshift. It blurs the edges of your photo selectively so you can highlight an important element in the frame. The big downside to Tiltshift is it's clunky interface. You have to jumps through some hoops to finally select a photo from your library to work on. Camerabag has some problems as its a huge memory hog and will crash your phone if you haven't re-booted the phone and cleared your memory before using it.
The great thing about all the photo apps is that you don't have to use just one on a photo. You can combine them with each other. Open up Camerabag, apply an effect and save the photo. Then open up another app and apply another filter. It is like you have Photoshop in your phone. Does any other smartphone have those features? Not that I know of currently. Probably a huge reason why many photoraphers are buying iPhones.
Below I show some of my photos in various stages of post-processing. I used Helga in Camerbag and the Tiltshift app in my workflow.