[jasonv]

Do they encourage people to buy a new phone every year?

I don't think most people get a new phone every year, hence the "is this worth the upgrade?" Conventionally speaking, most tech reviewers tend to suggest that the latest model usually isn't worth the upgrade if you have the last model, and only in some cases is it a compelling upgrade from two releases ago.

Release a new phone every year isn't the same thing as encouraging everyone to upgrade every year.

[mercer]

Anecdotally, very few people I know get the newest phone. In fact, most of them tend to get second-hand phones that are at least a generation or two behind. That said, these are generally on the middle- to lower-middle-class individuals.

I'm a geek and I could afford buying the latest phones, but in practice I almost always get a phone at least 2 generations behind.

That said, looking at people in town, there's a significant number who do get the latest model. I always wonder how they can afford it.

[DonaldPShimoda]

If you sell your 1-year-old iPhone as soon as new ones are available, you maximize the secondhand sale price. After that, the value you can get will decrease. (The same is true of the value Apple gives for their trade-in programs.)

So in some sense, if you replace your phone as soon as a new one is available, you pay about 50% of the new phone's cost every year. So it's not quite as expensive as you'd think. (And yes, iPhones sell for a little over 50% of their purchase price after a year.)