It's funny that just a week ago, the rumors of Apple releasing a 5-inch class iPhone--as started by this Taiwanese report naming an "iPhone Math"--were not taken seriously among the Apple fans. Their arguments were keyed to a familiar tune: Apple doesn't design products in response to competitors; just because large phones like Samsung's Galaxy SIII and Note II are selling well doesn't mean Apple follows suit. Apple leads, not reacts. The iPhone 5 already bumped up the screen size for the first time after five generations of 3.5-inch phones--4-inches is [now] the optimal size for one-handed use! The only new iPhone this year will be the 5S, because that's been the pattern for the past four years.
But how quickly opinions shift to fall in line with the Apple blogging elite. When Marco Arment and John Gruber start taking the five-inch iPhone rumor seriously, it's time to start nodding your head. MG Siegler and Jim Dalrymple can't be far behind, and soon, everyone's on the "I told you so" bandwagon. These are people "in the know", you see, and they take their prognostication very seriously. Suddenly, Rene Ritchie's number crunching doesn't sound so crazy.
Such is how the Apple rumor circus goes.
So let's play along and think about what a 5-inch iPhone would mean for Apple's product line, why it [suddenly] makes sense, and why some people may be resistant to the idea.
Marco's argument sounds logical: in cellphone stores, the iPhone offering looks diminutive next to a lineup of phones that range from 4-5.5 inches. Even if a narrow 4-inch phone fits best for one-handed use, there are plenty of customers who for many different reasons prefer a larger phone--they don't own a tablet, they like larger text, they prefer texting with two hands, etc. A large phone isn't designed so just to accomodate a larger battery, as was necessary for early LTE handsets. As the many owners of a Note 2 can probably attest, there are some real benefits to a larger screen, even if it's not at "retina" pixel-density. For example, I like that on the Nook 2, the Google Calendar widget can show an entire month of appointments at a glance, something that's not even possible on the Nexus 4's 4.7-inch screen.
The release of a 5-inch iPhone Plus would also have to be an acknowledgment that there's currently money being left on the table. That, surprise, the current iPhone form factor isn't right for everybody. That Samsung and other large phone makers got it right with their "phablets". Apple fans--deal with it.
Gruber's agreement that such a phone would use a smaller cut sheet of the same 264PPI LCD from the retina iPad is also logical. It's what Apple did with the 3GS LCD cut larger for the iPad Mini. But again, that would require a concession that pixel density isn't everything either; a 5-inch iPhone Plus would then be the first iPhone to go down in pixel density. Gasp. Again, Retina sticklers--deal with it.
And then there's the concern of cannibalization. No doubt that if Apple were to release two new iPhones this year--assuming both the iPhone 5S and iPhone Plus--there would be customers who buy the iPhone Plus who would otherwise have bought a 5S. Overall, with product diversity, Apple would likely see higher sales than if they released only one class of iPhone. But I doubt that Apple would be able to announce, as with the release of every previous new iPhone, that this year's new model was the "best-selling" one yet. Prepare yourself for the analyst feeding frenzy.
But we've already seen this happen. We saw it with the iPad and the iPad Mini. Cannibalization did happen--some people ditched their full-sized iPads because the advantages of the Mini (weight, price) outweighed its disadvantages (older screen, processor). Apple never got to claim that the fourth-generation iPad was the best-selling one either. And when asked about cannibalization, Tim Cook said on last week's earning call that it does matter because the company would rather get more people into its ecosystem, citing the "halo effect" of its products.
Resistance to an iPhone Plus may derive from the fear of choice--the same reason an iPhone Plus would exist in the first place. My impression, as someone who's bought every new iPhone, is that if there were two new flagship iPhones launched this year, annual iPhone upgraders would be crippled by choice. Which one would be the "best" iPhone? Adding a new size must be a sign of that evil word: compromise. I know, it's irrational and stupid. Buying a new phone every year is stupid too. But Apple isn't playing to that crowd anymore--they're already hooked. And in order to sustain the kind of growth expected of it by shareholders, Apple needs to expand its reach to new customers. The company line may still be to create the "best" products to delight its customers, but that customer base is an increasingly diverse set of users with different needs.