Yes Marlin is truly awesome and impressive. They are solving very different problems than we are in many ways e.g. DRM, library lending, digital transition for retailers, etc. And currently they are focused on iPad only vs iPhone and Android devices as well (though I hope they get there - the more the merrier).
It is not clear to me yet what their revenue model is, or how they are funding development. Do you know? I'm guessing they are venture funded, but I've found no real info on them. Startups with no revenue model often end up either spamming users or selling their info - I hope that does not happen here. The app reminds me a little of Readmill and Subtext both of which I also like quite a bit - for different reasons. Though the angle and business models are fairly different there as well.
Though of course, with any reading system, there is tons of overlap in terms of what makes for immersive and "active" reading. That said, I think we'll see a lot more specialization of reading system apps moving forward. There's just a massive spectrum of potentially useful features that developers have to prioritize, and the mix will vary a lot based on audience, business model, subject matter, etc. e.g. apps for education are likely to focus on different features and UX than for trade retail.
There is no doubt that our particular business model (b2b) means very different priorities and focus than what appears to be going on with Marvin at the moment. But then, given that we do already have a revenue model, and operate in the black, means we'll likely be still plugging away at this for years to come, (I hope) and constantly making the apps better. I expect to see many of the current crop of ereader apps from venture funded startups dissapear in the coming years, or get folded into larger companies - like Stanza at Amazon - which did not turn out all that great IMHO.
FYI, when we originally launched in 2010 our business model was affiliate revenue from OPDS catalogs in the app. Apple put the kabosh on that in early 2011 when they, er, "clarified" their policies on outbound links in ebook apps - coincidentally at the same time they launched iBooks. It was devastating. But we adapted and pushed through. Never a dull moment in ebook land.
Again, I don't know much about the Marlin folks other than that they do some great work. I hope they keep it up. Like you said, there's nothing better than healthy competition to inspire innovation.
Back on the topic of text selection, I hear your frustration about the responsiveness and how it varies from the standard iOS API's. I've a few ideas on how to make that better, and we do plan on experimenting to see how that might work. Also, EPUB3 will use a very different rendering strategy, and we'll be better able to leverage native API's.
Thanks again for the detailed feedback.