Apple needs to be very careful that they don’t erode the things that most differentiate them from their competition.
Agree. But I believe Apple thinks they also need to move harder into "services" and, I suppose, now ads. I think Apple recognizes that the high-margin hardware business is not not sustainable. Especially as everyone who would want an iPhone already owns one. Apple needs to grow somewhere.
Everyone that owns an iPhone cycles them out every 2-3 years. It’s a perpetual cash cow.