In May 2011 Pinhasi et alii have published a paper suggesting that Neanderthals living near the Caucasus Mountains had disappeared before the arrival of anatomically modern humans. Despite this, the two species of hominins must have met and interbred since there are remnants of Neanderthal DNA in contemporary humans according to research by David Reich. The research suggests that the two species met outside Europe, most likely in the Middle East. It is also possible that limited populations of Neanderthals surviving in Europe after 40,000 years ago may be responsible for the interbreeding. The results from DNA obtained by Reich actually demonstrate that all humans that moved out of Africa have traces of the interbreeding, and not just Europeans.
It is too early to decide what happened: all authors are involved in further research and more surprises are still possible. If these preliminary results will be confirmed however, next top question will be why Neanderthals were declining in Europe while anatomically modern humans, not significantly different in evolutionary terms, could thrive just a few thousands years later. I cannot foresee a solution to that hypothetical question by looking at physical differences: if anything significant was different, this may be the behaviour of our ancestors, and particularly their ability to maintain social relationships across long distances. I am not referring to very active relationships based on blood, and rather on loose relationships based on exchanges or simply mutual help between fellow humans. Modern humans are characterised throughout their history by their pioneering spirit (the current frontier being space) and a remarkable ability to maintain contacts across enormous distances. Trade links and more recently the Internet are the most obvious examples of this peculiar ability. In the animal kingdom, individuals with strong ties usually share blood or space (or both). Distance if anything can trigger speciation as groups become separated and highly adapted to their locations. Modern humans instead are physically the same despite living in virtually all kinds of climates, except for the most extremes ones, and regional adaptations are very minor in physical terms. Long distance movements of individuals is also a constant: they happened with the "out of Africa" (multiple) events, continued in the Neolithic with the spread of agriculture and the domestication of livestock, and they continued in the Bronze Age with commercial trade. They never stopped. In comparison, Neanderthals never moved much farther than the core of the European continent.
I already mentioned that Jean Clottes referred to Homo sapiens (human who think) as Homo ritualensis (human who performs rituals), and rituals are a highly sophisticated form of social relationship that allows people to share ideas, goals and cultural traits regardless of time, space or blood ties. I frankly find irritating all attempts to define anatomically modern humans with a single characteristic. For instance, I think that the ability to maintain as well as forge new social relationships across space is very significant and explains much of the success of modern humans, but I cannot state that it was the most significant or most important ability. In fact, I could not find one reason significantly more important than others.
The preliminary results in the news are therefore pointing out to the remarkable success in colonising our planet that our direct ancestors had, suggesting that evolution never produced any real competitors to the anatomically modern humans among the many species of hominins (with some probably not yet discovered). By looking at the physical capabilities alone, there can be no easy answer: evolution works in small steps, sometimes very fast, but interbreeding humans could not be genetically too separated or different. Perhaps it is time that we understand why we are so unique, and that is true even considering similar human species living alongside our species for several thousands years. The fact that Europe was not shared between Neanderthals and modern humans (at least by significant contemporary populations of both species) is not that important: DNA studies already told us that the two species met and exchanged genes.
Another top question for future research may be whether genes from anatomically modern humans exchanged at an early time (before 40,000 years ago) triggered some sort of collapse among Neanderthals, as evolution favoured our species and may have pushed Neanderthals to bred with our ancestors or not at all. I do not think however that there is a strong case for this since the DNA research suggests only limited contacts between the two species. Results from future researches are eagerly awaited.