Yes, phones get old and drop price. But whats the margin?
1\ Which is why it is another bad example. Again, how many do they sell in Canada to justify a new model?
2\ Like you said, you are ok with a sub $350 price if they spec is decent, then why not just wait for a price drop in flagship? Spec check, price check, done deal.
3\ Why fill the Q4 market with low margin model that will harm your flagships and mid-hi 8 series? Did you not notice lower series always comes mid Q1 and ever think about why?
4\ Market share means nothing if you are making losses.
5\ Nokia already have too many models and all they do is just handicap one after another to justify the value.
6\ With 13series coming in from the top and 6series pushing from the bottom, 7 or 8 series, one will have to go or you will see they will be a handicap ver. of each other.
Not everyone in the world is going out of their way to look for a Windows Phone, i.e. they're not going to just wait for a flagship to drop in price. Most consumers want to buy something at a specific moment in time, the onus is on Microsoft to offer the best deal for that user on time. How can anyone expect the user to wait when there's nothing to wait for? The case we want to make is "choose Windows Phone over Nexus or a Moto." The reality of the competition is lower pricing and customers who are looking for a negotiable price-point. You can't use "just wait" as a selling point, those buyers will buy Nexus/Moto, and hence, customers lost (for MSFT).
As for Q4, let's look at the reality. Thus far those who want and are able to get a high-end Windows Phone will get a high-end Windows Phone, regardless
of whether a mid-end version is available. You don't need much convincing if you're already predisposed to leaving your comfort zone for a Windows Phone. Of all the new Lumia 1020 owners I know, they didn't even look at the Lumia 520 at the store, they had a target and that was the 1020. People outside of that segment, i.e. everyone else who are ambivalent to their choices or considering Android/iOS, will need more convincing. Here's where a more negotiable price-point and better value proposition come into play. A good camera is nice, but what about a good camera, nice styling and a $350 price-tag? The question here is about getting those not predisposed to Windows Phone to look into WP.
As for market-share. Unless we see the actual phone, we can't automatically assume that it's going to be a loss leader. Margins will be tighter though. However, the reality of higher market-share and bigger user base is increased developer attention, and in turn, more apps, services and games, and in turn, stronger cause for user-retention and user growth. Moreover, more Windows Phone users also means more potential users of Bing and Skype.
Yes, Nokia has a lot of models and Microsoft is better off standardizing them into 3 or 4 core models.