While they're trying to compete in the areas of processor speed, cameras, location-awareness etc...

One thing Android based phones have already won over the iPhone equivalent is background notifications.

Apps on Android can run in the background. This feature is so crucial and often understated or under-valued...

Imagine:
You're on your phone, you don't have the time or patience to check your twitter updates. Or your constantly evolving calendar schedule that is not compatible with the in-built one from Apple that is being maintained by your PA.

On Android, all you have to do is leave your phone on. Your app will notify you of any new changes. Great.

On iPhone, you have to open your tweetdeck, your ical app/lotus notes app in order to check. Not a big problem... just that today is like any other day. You just came out of a client meeting that has overruned and you're in a hurry going to your next one. You're revising your notes, repeating the lines in your head. You arrive at your destination. The meeting changed. Bugger.

If Apple don't put their gear up soon. Android will be slicing away at their market.

A repeat of the ancient Macintosh vs PC era?

Need a new CPU or graphics card? Get AMD.