Mark Bridge writes:

I like a bit of competition. It can encourage innovation, whether it’s NASA’s moon landings or Formula 1’s telemetry. And it can be entertaining to watch, from Premiership football to the Tour de France.

It’s one of the reasons the mobile industry still excites me. Although the frenzied growth of the 1990s is gone, there are still many competing forces.

iOS versus Android versus webOS versus BlackBerry versus Windows Phone versus…

Samsung vs Nokia vs LG vs Apple vs RIM vs…

Vodafone v O2 v Everything Everywhere v Three…

In the midst of this competition, Apple appears to be edging ahead. The company has just reported sales of over 20 million iPhones and profits that are up 125% from last year.

Despite this, I don’t think the future is looking good for the Apple iPhone.

Smartphone sales are increasing worldwide, which means Apple’s share of the smartphone market hasn’t increased as dramatically as you might think.

Google says it’s currently activating 550,000 Android devices every day. That’s the equivalent of 200 million in a year (or 50 million in a quarter, if you prefer). The iPhone may be racing up the smartphone sales chart but its operating system isn’t at the top.

Then there are the legal battles. Not only is Apple involved in legal action with a number of manufacturers, it’s also seeing its application developers coming under attack.

What can it do?

Let me offer a suggestion.

It’s not going to stop selling the iPhone. Nope, the iPhone 5 (or whatever the next-generation iPhone is called) will happen. It’ll be popular. But, as every phone starts to become a smartphone, the desirability of an Apple phone will wain.

Instead, Apple will focus on the iPad. The iPad is already generating more revenue for Apple than the Mac computer. It doesn’t have much competition. In fact, I’d suggest that rival devices - the Samsung Galaxy Tab, the BlackBerry PlayBook, the HP TouchPad - are also helping to sell the iPad.

And because the iPad isn’t a mobile phone, Apple may not face the same patent-related challenges it’s suffered with the iPhone.

Do I know what I’m talking about?  Not necessarily. But here’s what I’m thinking.

First came the iPhone. Next, the iPhone 3G - cheaper and faster, but not much smarter. Then came the higher-spec iPhone 3GS, followed by the iOS4 update and the fresh design of the iPhone 4.

The second-generation iPad wasn’t cheaper than the original, but it was slimmer and faster. Which makes me think iPad 3, along with iOS version 5, will be a significant upgrade.

Apple’s not a mobile phone manufacturer. It’s an innovator. And the tablet format offers plenty of opportunities.