how powerful does a phone need to be? apple push you into upgrading. my ipad 2 can't use ios7 but i won't be buying another one.
I guess it's like PCs.
If lost productivity has a real "opportunity cost" it's worth upgrading if the newer model will be faster/more useful and means you can get more done more efficiently in less time.
For PCs, the tipping point was passed 2-3 years ago for the average user. A top end PC from that era will be perceived as just as fast as the top end machine you can buy today if you're using it for internet browsing, email, Word, Excel etc. Whereas that wasn't true 5 years ago.
I should know - since the mid-90s I've built my own PCs, and I've upgraded my machine every couple of years since then, taking it through about 6-7 iterations*. Until 2010. I've still got the same machine I put together in August 2010, and frankly I have no plans to upgrade (not even an inkling of an urge to do so)
In other words, computers have now gone beyond the maximum speed that a typical office user will notice. Gamers and high-end users (graphics designers, 3D modellers, video artists etc.) will still benefit from every ounce of speed, but the average user won't notice - everything happens "instantly".
I don't know if we're there yet with phones or tablets, but once we reach that point I expect there will be a massive slowdown in the upgrade/replacement market, just like there has been for computers.
*For the hardware geeks: 486, Pentium, Pentium MMX, Pentium 2, Pentium 3, Pentium 4, Core i7 930 (which is what I have now)