What next for iPhone as rivals up their game?

I'm a proud iPhone owner; to the extent where TechRadar's mobile phone expert considers me entirely biased against everything else. But, although MWC has not yet thrown up a handset I'd trade my trusty Apple in for, it's becoming increasingly clear that the rest of the mobile world is finally beginning to compete with the iPhone.

When I bought my iPhone 3G there was nothing that could even touch it in terms of aesthetics, GUI and, let's face it, X-factor (minus Simon Cowell).

Now, however, there are handsets beginning to snap at Apple's heels. Palm's Pre for instance is wowing and RIM's aim at bringing the BlackBerry to the consumer world is picking up pace.

And, although T-Mobile's G1 was a fairly average handset, Android was certainly anything but an average OS. The moment I got back to the office I made the suggestion that my next phone would be an Android phone.

iPhone killer?

I have to confess I was hoping for a little more in the way of key handsets at the Mobile World Congress – but although the final product is still missing, some of the announcements around chips, partnerships and operating systems are enough to suggest that we live in interesting mobile times.

Which presumably means that Apple will need to respond to the new threat.

Now, rumours about the next generation iPhone are rife – but in some ways having a firmware that can be easily upgraded make hardware upgrades a little less pressing.

Firm changes

Whereas once an old phone lacked cutting-edge functionality from pretty much the moment you took it out of its packaging, now that can be added with a simple upgrade.

For the iPhone, the arrival of the 3G version also brought a whole new firmware, and an app store that meant new functionality arrives all the time, but some of the core functionality is still missing.

Cut and paste has been a hot topic virtually since launch, but with more and more manufacturers signing up to Adobe's Open Screen Project it is the lack of Flash support that is looking increasingly jarring on the iPhone - although talks are apparently ongoing with Apple.

Hardware changes?

And, should Apple feel that it needs to respond to the growing threat by actually releasing new hardware, what can we expect?

With Intel and Nvidia pushing advanced chipsets for portable devices at MWC, the need for a more powerful processor is surely the most obvious upgrade. More processing power could bring the prospect of proper multitasking on the phone with multiple apps running at the same time – and presumably make core functionality like cut and paste easier to implement.

Graphics processing may also be boosted, which could feasibly bring 3D gaming to the handset.

Criticisms of the lack of MMS, the weedy camera and no video functionality would make it fair to suggest that Apple will look to upgrade in those areas and with phones beginning to use compasses (which are helpful in apps like Google's Street View) that could be an added extra.

Apple does things at its own pace, and is beholden to no other firm. But I'd suggest that the company is well aware that it may need to step it up in the near future.