If you look at the progress not just in design, but software, hardware and everything. Samsung, HTC, Nokia, all the major manfs have come miles further than Apple in the last 5 years when it comes to hardware design.
When it comes to software Android has also come miles in the last few years. People that aren't Android users don't realize this and go with the same standby arguments against Android (fragmented, ugly ui, non-integrated UI). When Android first came on the market (HTC G1) it could not even compare to an iPhone. But Android has solved many of these problems over the years, due partially to the fact that it's open source and has lots of people / companies contributing to it. It has now come to a point where it is miles beyond iOS and iOS has even gone as far as starting to steal features from Android (notifications drawer anyone?).
I've said it before I will say it again. Apple should spend less money worrying about and suing it's competitors and spend more time and money on improving their mediocre products.
The time for something new from Apple is definitely soon or they risk starting to lose market share. Although, most of their users are to drunk on koolaid to even know what other products are in the market.
[1]: http://en.wikipedia.org/wiki/List_of_iOS_devices#iPhone