How different keyword tools measure competition (SE Cockpit)

I'm hoping to find out more about how various keyword tools measure competition. I hear good things about SE Cockpit and have seen demos if it. I'm wondering if Shane can answer how the calculation is done. I know that they give measurements of the top 10, but how is the calculation done?

I'm assuming the way we do it is through analyzing the top 10. But then what aspects? I can think of:

1) Onpage SEO (keyword in URL, Title, Description, H1, etc.)

2) PR or SEOMOZ authority of the top 10 pages

3) Quantity of backlinks to those pages

4) Quality of those backlinks to those pages (in terms of
a) Number of unique referring Domains and IPs
b) Anchor text
c) Do follow?
d) PR of page of backlinks (and how many OBL on that page)

5) Quantity of backlinks to the domain

6) Quantity of social signals (Likes, +1s, Tweets)

Any other things to add?

I know Shane you've said that SE Cockpit is incredibly fast which is a great asset. But I'd like also to know how you measure competition because if we're going to trust the score given beside the top 10 pages, we first need to know how the competition score is measured.