This is exactly the kind of sh** you learn in business school never to do. Why release a brand new product that destroys the sales of your current products? There isn't room for keeping older phone models around at the same price point as this new thing - unless the plan is to never sell older models once the current one comes out and thus reduce inventory levels? It just seems plain silly to me.
Yeh this comment was a huge Doh!
Samsung are already hammering Apple sales with cheaper offerings. It's not ideal but Apple do not operate in a vacuum. Better that they also compete with a cheaper offering than try and ignore what is happening in the world......and also hope to pick up some cash via the Apps.
Furthermore I suspect that even though it WILL take some sales from the higher-end products, I think the bottomline margin will still be quite nice!!