Is apple falling behind? yes. By not releasing an updated phone, HTC, Moto, Samsung have leap frogged apple on the hardware. They have superior screens, and specifications, though consumers care little of specifications however. What they do care for is faster phones that are cool to use. Apple still has the cool factor.
iOS is also falling behind, android with every revision is offering more and more. honeycomb for instance has an interface the (for the tablet) that rivals if not exceeds iOS. Add in the ability to actually customize it, makes it a potent competitor.
The danger for apple is that if they play it safe and produce only minor incremental changes to the hardware and software. Their competitors are not producing minor incremental updates. Apple needs to continue to innovate or risk falling behind.
They were in this position before so hopefully history will not repeat itself, i.e., Pc vs. Mac.