If you don't upgrade every 2 years, your throwing away money. The subsidized price of the phone is built into the enormous amount of money the major cell phone companies ( Verizon, AT&T, and Sprint) charge per month. If you don't upgrade, your overpaying for a service without the benefit of using a new, subsidized phone.
Yep exactly. I got my family on 5 iPhone lines recently with Verizon. When we are all due for upgrades, whoever doesn't want/care to upgrade I plan to buy the newest iPhone model and sell it.
On the longevity of the iPhone 5, I think it will be fine to use for at least 3 years. It already has the latest cellular data technology in LTE and this will likely be the standard for the next 5 years as most carriers are still expanding their initial LTE network rollouts. Apple is known for supporting devices that are up to 3 generations old so you'll probably still get regular updates well into 2015. The screen is perfectly sized and it has a very fast processor, GPU, and significant RAM. I plan to keep mine at least 2 years as it seems most smartphones these days are just bumping up specs rather than new killer must have features. If I upgrade before then it will just be because of the tech geek in me itching to have the latest device.