According to research firm IDC, the smartphone market has recently crowned a new leader, and its name is Apple.

"Ever since the first iPhone launched in 2007, Apple has made market-setting strides in hardware, software, and channel development to grab mindshare and market share. Demand has been so strong that even models that have been out for one or two years are still being sought out. With an expected refresh later this year, volumes are set to reach higher levels," said Ramon Llamas, senior research analyst with IDC's Mobile Phone Technology and Trends team.

Without having to release a new smartphone model in the past 13 months, Apple Inc. overtook Nokia Oyj and new force Samsung to be the top smartphone seller in the second quarter.

Beyond the "world's number one" in shipments award, Apple's financial statements showed that Apple delivered its best quarter ever, recording a 125 percent increase in profits to $7.31 billion.

But amid a roll-out of the Mac OS X Lion operating system for its personal computers, the new MacBook Air laptops, the Mac mini in the past month, Apple CEO Steve Jobs surprised everyone by not unveiling the new device at the developers' conference in June. Though many have been asking why the iPhone 5 is still not available in the Apple Store, the question that matters to Jobs is: Do they really need to release the iPhone 5 at this time?

Production Problems

Sources have indicated that Apple has delayed the iPhone 5 due to production problems. However, note that reports (or rumors) lean towards Apple releasing an iPhone 5 that closely resembles the previous model -- not a new smartphone with a teardrop or radical new design. But if Apple is only releasing a fancy iPhone 4 with an 8-megapixel camera (upgraded from the 5 megapixels) and an A5 processor (which is already on the iPad 2), why would it have production problems? Since 2007, demand -- and thus production -- of iPhones has recorded double-digit growth year after year. Surely suppliers wouldn't put Apple orders at the end of their pipeline, given that Apple has been a good and guaranteed source of revenue.

Another issue could be the iOS 5, which is expected to be the platform for the iPhone 5. However, the iOS 5 is not expected to make leaps and bounds from the iOS 4, unlike the Mac OS X Lion, which had major improvements from its predecessor. Apple has already announced the features of iOS 5 to its developers: the iCloud service, upgrades to the Camera app, Reminders, Newsstand, and iMessage. If there are additional apps being considered for iOS 5, they have likely already been tested, as Mac OS X Lion was already released last month. Mac OS X Lion, which borrows the interface provided by Apple's iOS-run tablet, has a host of new features and built-in apps. Thus, it would be unlikely that iOS 5 is delaying the iPhone 5. And it is possible that the iOS 5 could be released ahead of the new iPhone model.

Soaring Demand for the iPhone 4

Why fix if it ain't broken? Although the iPhone 5 delay has disappointed some people, Apple still sold 20.34 million iPhones in the quarter ended June 25, 2011. With the additional help of the iPad 2 and Macs, Apple posted record revenue of $28.57 billion and record net profit of $7.31 billion, or $7.79 per diluted share, during the quarter.

Its nearest rival, Samsung jumped from having a 5.6 percent market share in the second quarter of 2010 to a 16.2 percent market share (17.3 million units sold) in the second quarter of this year. Key to its continued success was the global popularity of its flagship Galaxy S smartphones. But take a look at Samsung's best seller: the Korean electronics giant sold five million units of the Galaxy S II within 85 days of its release. Assuming an optimistic trend, Samsung within 12 months will likely sell 20 million units of the Android-based Galaxy SII, which is still a fourth to the 69.3 million units of the iPhone (most of the iPhone 4) delivered by Apple for the 12 months ended June 25, 2011.

As for other rivals, Research in Motion, the creator of the BlackBerry, has lost market share, and Nokia is still in production mode for a new smartphone line. Nokia ceded the number one position for the first time in the history of IDC's Mobile Phone Tracker.

Would Sony retire the PlayStation 3 if it's still outselling the Wii and the Xbox? Likely, no. Apple has continued to generate massive success with its present portfolio. According to IDC, Apple's success can be directly attributed to its distribution (more than 200 carriers in more than 200 countries), increased manufacturing capacity, and solid demand within emerging and developed markets from both consumers and business users.

The timing is important for Apple because it has been betting on a single horse each year. While rivals like Nokia and Samsung are usually releasing multiple smartphone models every year, Apple offers only one. Hence, it would be impractical for Apple to retire the iPhone 4 when it is beating its rivals.

Rivals Still Holding Their Aces

Aside from Samsung, Apple's competitors have yet to come up with a phone that could beat the iPhone 4: Nokia and BlackBerry have not released new major smartphone models this year.

Research in Motion, whose QWERTY phones have struggled to maintain their relevance, just days ago unveiled five new BlackBerry smartphones based on the BlackBerry 7 Operating System. However, the outcome of RIM's "largest roll-out ever" has yet to pan out. RIM is offering the keyboard + touch display, and "thinnest ever" BlackBerry Bold 9900 and 9930, the slide-out BlackBerry Torch 9810, and the BlackBerry Torch 9850 and 9860, with the largest displays. Having fired 11 percent of its employees due to struggling sales, RIM is in make-or-break mode this time. Whether the new BlackBerry 7 OS-based phones push RIM back to relevance -- and have U.S. presidential candidates flaunting their BlackBerries -- remains to be seen. BlackBerry still has something up its sleeve: it's expected to release superphones --- based on the QNX-based operating system, which is running RIM's PlayBook tablet computer -- next year.

Nokia, like RIM, has lost ground to rivals this year. Even as the company released new smartphones running on Symbian^3, demand for its products running on the aged Symbian platform has shifted to other devices, according to IDC. Nokia's has already unveiled a major offering for the third quarter: the Nokia N9. The Nokia N9 is touted as one of Nokia's finest works to date, based on design. The Nokia N9 is a button-less touch screen smartphone with a curved design and a 3.9-inch AMOLED display, and runs on a new mobile operating system, the Meego. But wait, Meego? Nokia was supposedly going to replace the Symbian with Meego. But this year, Nokia changed course and announced that it will be releasing smartphones based on the Microsoft Windows operating system. Thus the N9 could be the first and last Nokia model running on Meego. The more relevant offering then would be the Windows 7 or 8-based phones. Nokia has not released or unveiled its new Windows based phones (except some prototype released on YouTube). The first Windows-based phones are due in the fourth quarter of this year. Nokia, the perennial number one vendor in the past 10 years, already has established sales channels and a distribution network, as well as partnerships with carriers worldwide. If Nokia barrages the market later this year, and establishes a new fad with its Windows phone, Apple would have nothing to put up against Nokia if it releases the iPhone 5 at this time.

The circumstances rivals are facing -- and their failure to provide major offerings -- provide credibility to reports that Apple instead will release the iPhone 4S, just an upgrade to the present iPhone 4. WIth the iPhone 4 still soaring in sales, Apple would likely let rivals take the jump first with their new phones. In this way, Apple can further make improvements to the new iPhone 5 and add more features that would outclass the rivals' new "superphones."

With Nokia and RIM still groping for form and Samsung cutting only into Nokia's market, Apple has been the prom queen this year.