I think you might be overstating just a bit.
While the iPhone is very popular, it hasnt put it's competition out of business.
From what I've gathered, the new Apple product is a tablet PC with the ability to read ebooks. Think of it as a larger iPod Touch.
It's competition is probably the netbook market and the e-reader market.
Amazon, Sony and B&N have put out dedicated ereaders. I'm not sure that they will be in direct competition with Apple.