Actually yes. for a start call quality is better than when using the iPhone. Yes Native Union has used a better speaker and mic, but equally important are both speaker and mic actually cup your ear and mouth respectively. Much like using a decent pair of well fitted earphones the difference this makes is incredible. Voices sound clearer and more lifelike. It also has the defacto bonus that you won't accidentally mute calls with your cheek (an ongoing iPhone problem) or smear up the iPhone screen. It cuts down on radiation too, if you're a paranoid type.
The iO3 has a few tricks up its sleeve as well. The most obvious is voice dialling. Add voice tags to any contact on your handset then hold the multi-function button for 1.5 seconds and when you hear the beep speak the tag into the receiver. A further bonus is while Native Union pushes the 03i as an iPhone accessory it will actually work with any Bluetooth device. This means any modern mobile phone can be paired or even a Bluetooth equipped PC for VoIP calls. The i03 has multipoint support so it can be paired with up to two devices simultaneously. Pairing is also with the receiver not the dock so carry the mobile phone with you and you'll never go out of range.
So this seemingly daft device is actually an unqualified success? Actually no. The i03 cannot connect to a PC to sync the iPhone and at times we found it would intercept a call mid-call when we had chosen to answer using the iPhone. This is quickly solved by switching the speaker source back to the iPhone, but annoying nonetheless. The other big caveat is price. At almost Â£100 online (RRP Â£119.50) the iO3 is more than 3x the price of a typical DECT cordless home phone and for almost the same price you will now find the excellent Etymotic HF3 headset which can be plugged into a call at any time to make it completely hands-free while also being an excellent pair of earphones. You won't need to leave battery sucking Bluetooth switched on your phone either.
That said the i03 does have a place in the world. The most obvious use is on a desk where you're sat for long periods each day. Being able to intercept calls while seeing the iPhone screen and still leaving the phone charging is a major plus. In the home where you tend to move around more when on the phone the proposition weakens considerably.
At first glance the Live Union Moshi Moshi i03 is an incomprehensible product. On closer inspection it is well made, nicely designed and has definite advantages - particularly in office environments. Call quality is better than the iPhone and the receiver inherently more comfortable too while iPhone 4 owners will be happy to eliminate Antennagate issues. That said the price is high and we'd be tempted to spend the money on a good quality pair of earphones with a built in mic instead.
Update: The i03 can indeed sync with iTunes. We initially had problems with our unit at the time of this review, but now it works swimmingly.