Compared to the Palm, Blackberry and Windows Mobile devices I was used to, the iPhone instantly became the holy grail of phones. And had no real competition until probably around the 4.
I'd say it was around the time of the 4S that the competition really started heating up.
As for Apple's contribution to the smartphone scene, I'll say what I've always said. They didn't invent the smartphone, nor any of the technologies present in the first iPhone. What they did was make the smartphone elegant and easy to use.
Apple's raison d'etre is the user experience. They rarely ever invent anything wholesale.