The dust is settling from last week’s Apple WWDC event. As I suspected, not much was discussed or foreshadowed in the way of hardware. All of the major mobile innovation was focused on the software in iOS 7 – new UI, new notification center, etc. It wasn’t much different than Google’s I/O developer’s conference. All of the innovation was focused on software there, too.

While I believe that all of the major innovations will be in software for the next two years, it’s still important to have competitive hardware. I don’t anticipate Apple will have trouble competing in the market with iOS7. Their biggest challenge will be competing in a fragmented hardware market.

In the six years since the iPhone has been out, the device really hasn’t changed that much. Sure, it got a little bigger, thinner and lighter with the iPhone 5, but outside of that, it really didn’t bring any major new features.

iPhone 5 vs iPhone 4S

Contrast that with Android hardware options, where there are a wide variety of sizes, features, price points and colors to choose from. You can choose a phablet device size like the Galaxy Note all the way down to devices that are close to the size of the original iPhone. Then there are devices in a rainbow assortment of colors, prices ranging from less than $50 to over $700, and features like waterproof phones, which Sony just released in their recent Xperia ZR model. It’s rated for depths of up to 1.5m for 30 minutes and will even shoot pictures and video for you. With the iPhone, you get two choices – the iPhone 5 or iPhone 4/4S.

It’s no surprise to me that Apple recognizes this, which is why rumors are starting to surface that there could be many different iPhone variations coming to market over the next six months. Rumors have a 5.7″ iPhone in discussion, iPhones in multiple colors, and varying price points. If Apple wants to preserve its market share and continue growing, it’s a strategy they’ll have to adopt if they want to stay competitive in the market.