My coworkers say Tim's statement "We always focus on making the best products" is BS. I disagreed, but wonder how that reconciles with a rumored low cost iPhone. If Apple introduces a "low cost" phone (vs. just lowering prices of previous generation models) how will they spin that with Tim's methodology?
The "low-cost" strategy is for companies that have slim margins on a high-end line (that serves mainly as a way to advertise the brand and relate it to high-quality), but really make the bulk of the profits on poor-quality low-end. E.g.: cars, DSLRs cameras, running shoes... almost all manufacturers work like that nowadays.