Apple was doing just fine in 2007. OS X was in great shape. They had recently transitioned from the faltering PowerPC CPUs to x86, which revitalized their hardware offerings and opened up a world of new possibilities for users to dual-boot or virtualize other OSes. Their market share was pretty solid, and their share of PC profits was quite high.
You say "stature in the industry" as if there's a single "the industry" that encompasses both PCs and phones. If Apple hadn't done the iPhone then maybe Microsoft or Nokia would have done better, but so what? That wouldn't affect Apple in the PC market. Wikipedia says the top five PC makers are Lenovo, HP, Dell, Asus, and Apple, and as far as I know Apple is the only one with a substantial smartphone business.
Of course Apple wouldn't be nearly as relevant overall in a world where they never produced the iPhone. I don't care about that. I see no reason why the Mac wouldn't be about as relevant in the personal computing space, which is what I care about.
In any case, I'm not just annoyed at the existence of the iPhone, but the nature of it. If the iPhone had been a Mac-like open platform instead of this walled garden bullshit, all of my complaints would go away. I have no problem with mobile per se, I have a problem with pervasive vendor-controlled code signing, not getting root on my own devices, etc.
Most of Apple's APIs and tools run on and build for both Mac and iPhone. Without the iPhone, Apple would have to pay for that from just what they made from the Mac, so improvements to macOS would come slower than they do now.
> improvements to macOS would come slower than they do now.
I'm starting to wonder how many people here even remember what Apple was like 10 years ago. The way macOS has "improved" under Tim I think "the slower, the better". One of the best WWDC moments this year was when Tim announced a maintenance release.
Apple has hundreds of billions of dollars. They can focus on more than a few products. It's natural that they look into AI.