Apple's insistent on a closed system means iPhones are never going to become more than a niche, luxury product as happened with the Mac when it went up against the Microsoft and Intel which licensed their products to all-comers. The Android hardware producers are making a range of phones at prices which will appeal to the mass market in a way which Apple can never hope to, and admittedly probably doesn't really want to.
The announcement today that Samsung has outsold Apple in the last quarter, selling 27.8mln phones against Apple's 17.1mln, is pointing in this direction.
So what is the future for Apple? Does it return to being a maker of niche products for graphic designers, the media community? Why would a large multi-national equip its employees with Apple phones when an LG does the same job for a lower price. Or are there other products, beyond the iPad, it can invent to change the game and keep it ahead of the crowd. There's nothing obvious out there, and even the iPad feels to me like it will be a less appealing/must have product than the iPhone.