The issue with the current strategy is that the pixel density wars are reaching their logical conclusion and will no longer be driving generational improvements at the flagship level as they have in the recent past. They need a strategy to market high-density and half-density devices in each product generation. The half-density devices will also have half the graphics cores and a smaller battery pack, so there's a substantial cost savings associated with a half-density display for the value-oriented device. The other factor is that Apple has to ride the process yield curves at the contract foundries which fabricate their system chips. The foundries don't want to keep their 45nm fabs in production alongside their 32nm fabs just so Apple can sell a fully-subsidized iPhone 4. They need to take those fabs offline and retool them for the 22nm process. Apple is holding up their development roadmap. A final consideration is the the 64-bit ARMv8 instruction set architecture is due to arrive in 2014, and Apple will want to minimize the time period during which they have to ship fat binaries for two different processor architectures. When the flagship iPad moves to 64-bit, they're going to want to transition the budget products and stop selling new 32-bit devices with all due haste.

"Who is going to buy a poor mans substitute easily recognized as such?"

Millions of people.

Nonsense.

clueless

Do you ever get tired of predicting Apple's imminent demise, and being wrong every time?

You keep harping on market share.

Apples sells just about everything they can possibly make as fast as they can possibly make it at the best margins in the industry.

They just set yet another All Time Quarterly Sales Record.

Their slice of the Post PC pie is getting smaller because the Size of the Pie has grown exponentially. (It's a marketing 101 concept you might not be aware of. In mature markets such as laptops Apple's market share has quadrupled.)

If Apple has any short term issues it's how can they increase production even more to meet the booming demand?

What do the red & purple badges to the right of your name represent?