http://www.rockymountainnews.com/news/2008/apr/24/grand-theft-auto-iv-a-brutal-new-world/
Says this about your phone, and in particular the phone camera:
RINGING ENDORSEMENT
Just like real life, it's imperative to carry a cell phone in Liberty City. Here's how to use different phone functions in Grand Theft Auto IV:
* Phonebook: Lists the names and numbers for all of your virtual friends. You can use this to find missions or jobs, or arrange nightly outings such as hanging out at a bar or shooting a game of pool.
* Messages: If you miss a call or decide not to answer your phone, friends can leave text messages for you. You also can send messages to friends within the game.
* Organizer: Some missions and dates need to be planned in advance. This in-phone organizer alerts you when your appointment is coming up.
*
Camera: After earning a better phone you can use this feature to take pictures and send them to friends. Occasionally, you'll need to do this in a mission.
WTF?