Well maybe, but in a year these manufacturers have come close. Apple in the meantime has released essentially the same phone with 3G and GPS. What do you think the other manufacturers will do this year?
Well it is certainly very similar hardware, with some components (like the processor) identical to the previous model. So from that perspective they have made little progress from the initial unveiling at MacWorld in January 2007.
If you look at the software from when it shipped last July and what will ship in a couple of weeks (including the progress made with the version 1 point updates) it is a different story.
I think version 2.0 is significantly better than Apple's initial offering. I'm talking about value added features, not just the inevitable security/stability improvements. Apple is also offering a platform for third parties, which they were not before.
Software plays a big role in the phone and Apple have dramatically improved their software, so from that perspective iPhone is not same phone as 12 months ago.
I like the look of the XPERIA X1 from Sony, which I think will do very well. I also like the look of the new NOKIA E SERIES phone (61 I think, the thin one). Both of these are sure to be popular with customers wanting a tactile keyboard. Apple should offer more hardware options, for sure.
These phones would probably have come about without the iPhone anyway. Apple's in a market far more innovative than the PC market, where companies mainly compete on price.