Almost everyone I know was bumping up to the 16GB limit on their iPhones, largely because by this point people have 2-4 years worth of photos on their devices.
If Apple moved to 32/64/128, nearly everyone would have gotten the base model. Instead, for the first time ever, people like myself, and even my mother, decided to bump up to the next tier, which is not only plenty of room for most, but 4x the storage instead of 2x (actually, it's an even higher multiplier when you factor in the storage for the OS itself).
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Almost everyone I know was bumping up to the 16GB limit on their iPhones, largely because by this point people have 2-4 years worth of photos on their devices.
If Apple moved to 32/64/128, nearly everyone would have gotten the base model. Instead, for the first time ever, people like myself, and even my mother, decided to bump up to the next tier, which is not only plenty of room for most, but 4x the storage instead of 2x (actually, it's an even higher multiplier when you factor in the storage for the OS itself).
In other words, margins.
My wife burns through 2 gigs a month with photos.
The actual profits for making people pay so much for 64 gigs is crazy.