Apple shook up its iPhone lineup today with the addition of not one, but two new handsets. The new iPhone 5s will take the flagship position, the new iPhone 5c will get the mid-tier slot and the older iPhone 4S will become the budget option. Noticeably absent from this short list is the iPhone 5.
This decision to axe the iPhone 5 is very similar to what Apple did with the iPad 3rd generation last year. The company unveiled the iPad 4th generation with a few upgraded steps and then dropped the iPad 3.
The iPad 3 was given to cut less than a year before it first went on sale. Apple continues to sell the iPad 2, the iPad 4 and the iPad mini.
Without knowing all the details, I would guess the iPhone 5 was removed more for marketing reasons than anything else. Apple needed a decent mid-range phone and the “new” iPhone 5c is a much easier sell than “last year’s” iPhone 5. The iPhone 4S is still hanging on as Apple is able to keep it fresh with iOS 7.
It may also be cheaper for Apple to sell through the iPhone 4S inventory and make more as needed than it would be to keep the iPhone 5 in stock.