The announcement of iOS7 and the release of the beta earlier this week have heralded the first major design change for the platform essentially since it's release in 2007. Having now had a chance to look at it, I think it's not as important for what it is as for what it represents: significant change.
Whilst the iPhone was far ahead of the competition when it was released six years ago and it had retained this position until recently, the latest generation of mobile operating systems - such as Android 4, BlackBerry 10 and Windows Phone 8 and the recent previews of FirefoxOS and Ubuntu Touch - have left iOS looking visually very dated and the UX has been surpassed by all of the competition.
Apple have put themselves in a difficult place when it comes to making significant advances to their operating system: they have set the expectation amongst their userbase that the interface will not change dramatically with each update and old hardware will remain supported for a long time. With iOS7 they have had to break this in order to bring significant changes. (The hardware depreciation for iOS7 isn't actually very aggressive but, as it's a big cosmetic change, it will be more noticeable to users with unsupported devices.)
Having used iOS7 it's clear that Apple have closed the gap to the competition, not just in terms of appearance but also UX. The visual appearance of system dialogues has clearly been designed with retina screens in mind and makes better use of space so feels less cluttered - especially important on the physically very small screen of the iPhone4. The top and bottom swipe menus give much faster and discoverable access to key information and features show that they are prepared to make big changes to the UX.
However, there is nothing particularly new in terms of functionality in iOS7 - certainly nothing that stands out from the competition. The hardware is also an issue, especially with the iPhone where even the iPhone 5 feels heavy with a small screen when compared to the cheaper competition.
To sum up, iOS7 is a step in the right direction and does reduce the previously widening gap to the competition. Apple will have to make one or two steps of a similar magnitude to regain parity, combined with a major step forward in the hardware in the iPhone 6. Hopefully iOS7 has provided a good foundation for the improvements that need to be made.
Will iOS7 have a major effect on Apple? In a word: no. They have an extremely strong market share and that will continue to be the case. Most iOS users will stay with what they have due to a combination of familiarity and app store purchases but some people are already moving away as the competition is better and cheaper enough to make the switch appealing. (Anecdotally, the number of people switching away is small but growing - iOS7 may slow that down.) Probably the most significant effect is nothing to do with any of iOS7's features, it's to Apple's brand image: they are no longer the innovators who lead, they are now the conservative incumbent who follows.