I believe that the problem the industry are facing...............
..............is that their customers have matured along with the market. By this I mean that the punter no longer sees the point in upgrading annually. Furthermore, there is a noticible reduction in the phenomenen of "Fanboiism". Where are the annual stories of enormous lines of eager purchasers outside (for example) the Apple Store on launch day, high fiving as they come out with their new shiney? The punters are interested in what their app collection gives them, not the hardware any longer. It's what their phone can run which interests them, not the phone itself. If it will run their favourite applications properly, that is what they care about. I am certain that even if the "pholding" phone was easy to produce they would get a couple of years of above average sales and then that to would end up commodotized, no longer attracting large sales at even larger prices. The hardware manufacturers are on a treadmill that they cannot get off of.