100% agree.
My prediction:
iPhone 4/4s discontinued.
iPhone (the plastic color version... whatever it's named...)
- A6 chip, 16MB only, HSPA+ only, VGA front cam - Free w/contract or $299
iPhone 5
- A6 chip, 16MB only, LTE, HD front cam - $99 w/contract or $499
iPhone 5s
- A6+ chip, better camera, 32MB/64MB, LTE, HD front cam, 802.11ac, double microphone, HD audio for calls - $299/$399 w/contract or $649/$749
You of course mean GB, not MB.....
And I would agree that this will probably be what the line looks like this year (though I don't agree with the storage and prices on the 5S....still think they keep the 16GB/$199 option).
Then next year, they lose last year's model and add the larger iPhone as the top spot in addition to updating both the cheaper version and the 4" version.