You are getting downvoted a lot (for various reasons I'm sure), but you really do make a good point. The jump from 16GB to 32GB is $100 w/ the iPhone. I think a lot more people would jump for $50. But probably not enough to sacrifice the (generous) margins given by a $100 increase.
One thing I was certain about before today was that my next phone would have 32GB. Sorry Apple, I probably would have stuck with the iPhone for $199. Now I'm actually on the fence!
