There was an unprecedented, albeit slight, dip in iPhone sales just prior to the announcement of the 5, indicating a lot of people were holding out for a redesign. This was immediately followed by a record breaking launch (which the analysts still managed to paint as a disappointment in terms of units sold).
It stands to reason that the longer Apple continues to play the S release game, the bigger those sales dips will get prior to a bi-annual redesigned release. This may have Apple rethinking a 2 year cycle.
OTOH, if they move to an annual redesign to appease the demand, quality and innovation will likely suffer. This is probably why the redesign is bi-annual.
And don't forget, the stock holders love S phones. By the time the S version rolls around, the manufacturing process has the kinks worked out. The tooling is done. The supply chains are in place. All Apple has to do is keep the conveyor belt oiled. This all means lower costs and higher profit margins on an S release.