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Well there's two ways about this.
Ford vs GM
Ford did the model T which worked well but they didn't create another model for quite some time. GM had more models and did better...until it came to back to bite them.
Chevy, buick, pontiac, olds, caddy....very few people went from one to the other in their lifetime. Too many makes and models confused the customer and some pretty much looked the same. Years ago I saw some old buick ad from '82 that showed the lineup...they ALL looked the same. We're talking cosmetics but the costs certainly weren't.
Toyota has 3 makes (toyota (general) scion (younger) and lexus (high end)..that's it
You don't need to go crazy making more than three or so brands.
Although it could be said that when Jobs cut out Power computing from making mac clones it limited the market. Flash forward ten or so years and the chips don't matter as you can install mac os on intel processors now. (hackintosh)
I have to agree, but I bet it was more to keep the Apple name out of the muck, trading blows with Kindle and Samsung. Ultimately having to sell 7 inch iPads for under a hundred bucks, to compete with the seventy nine number the others can go for. Steve had selfish reasons for his designs and implementation of his products. They were his brain childs and he didn't want them to be anything less than what he intended them to be. Modern corporations don't operate like that, they will follow the money, if it takes them to bowels of Wal-Mart black Friday sales.
http://tech.fortune.cnn.com/2012/02/14/how-many-times-have-we-heard-about-a-smaller-apple-ipad/?iid=EAL