As many iPhone owners are aware, the iPhone and iPhone 3G are focused at near infinity for versatility. Personally, I take more close-up images, and would like the ability to actually read QRcode and Datamatrix barcodes directly from the phone at their usual size from magazines and equipment.
Both iPhone models have the same style generic mobile phone camera module with a screw style focus adjustment which has been glued at infinity in the factory.
Once you break this glue, you can turn the lens counterclockwise to bring the focus closer. In tests, I've had no problems focusing to as close as a quarter inch from the subject, although this is impractical as the iPhone shadows the subject heavily with its size.
Take a look at his results in this flickr gallery. The improvement is incredible!