I never said it would affect my products as a consumer (yet), and never said it would affect their products in terms of what the upper tier devices bring to the table (yet). Not sure where you deduced that, but for clarities sake, I don't think Apple's products would suffer if they brought an entry level device (at least not immediately...I do feel that over time, a cheaper product would, in turn, bring cheaper workmanship to the upper tier by exposing cheaper ways of manufacturing things that most consumers wouldn't notice. It's almost a given when a cheap product is made...just look at the nightmare GM is going through right now across the lineup of their cars from going with cheaper parts, even in the luxury line vehicles).
I feel it cheapens the brand by putting the devices in the spectrum of consumers from bottom to top, where as right now, the device exists in what can be considered the top (by standards of smart phones and their pricing). Does it really bother me that a person who is in a lower financial situation could have an iPhone of some sort? Not really...it isn't as "personal" as you'd like to think in that regard. Where I start to get irked is what follows such movement...you can see it everywhere in consumer electronics.
A great example would be Sony. Sony, at one time, was considered a very luxury tier electronics manufacturer. They made the more expensive product, and people bought it because of the quality and confidence the name instilled...and then they moved to a more general approach, releasing mid grade products (from receivers to tape players and everything in between)...then they wanted a piece of the less tech savvy consumer market, targeting the store brand products pricing point, and offering bare bones devices at just a slight increase over generic brand product cost.
Now...Sony is just another brand you see in a sea of electronics. Frankly, you probably wouldn't know a Sony receiver from a Harman Kardon (another generalized market casualty) or a bottom barrel Jensen. It's lost in the ocean of generic, money first products. Half the time they could probably rebrand some knock off product with similar specs as Sony, and you'd never know. This goes for TV's, radios, computers, etc.
In the end, I don't think that would happen to Apple in the same way, and the Sony example was an extreme case (to prove a point)...image degradation isn't all about a personal desire to have something nicer than another person...to that end I really couldn't care less...there are ripples that follow though, and they turn into waves and then into full out tsunamis at times. In the fickle world of consumer electronics...a companies image can make or break their future. Apple has such a solid and truly enviable image right now, venturing into the cheap phone market just compete with market share with Android just seems like the best idea of a person who doesn't really consider the bigger picture.