I too agree apple should expand a little bit and provide for the other percentage or users that actually want a larger screen phone from apple.
I see the panorama changing quite a bit, still cannot be said that it's a DRASTIC change, but if apple continues the route they've chosen lately, the ball will for certain change sides.
With high mobile internet speeds now (LTE) and faster WIFI connections as well as more and more free hot spots, a lot more users are consuming more and more multimedia, specially streaming videos (youtube, netflix, etc), these type of stuff demands a bigger screen. There will for certain exist a lot of people that want a "normal" size phone but the amount of people that are demanding bigger phones are growing exponentially (look at Samsung's success, and now Google's).
Not too long ago the iPhone was considered a BIG phone (when we made the jump from flip nokia and motorola phones to the smartphones world. Same thing will happen as people get used to bigger screens. Hell I've even seen A LOT of people say that the Galaxy Note 2 is AWESOME and the size is incredible, and that they wouldn't go back to not even a Galaxy S3.
Apple NEEDS to think OUT OF THE BOX again. Samsung is doing it with products such as the Note 2 and the inclusion of the S-Pen (again, A LOT of people bashing this at the beginning and now they love the thing because of how it's been re-engineered)
I for once am switching from a 4S to a Note 2 in the upcoming days, I wanted a Nexus 4 but it's not being sold in my country, still I wouldn't go lower than 4.5 - 4.7 inches anymore (and I own a Nexus 7, so I'm not looking for a PHABLET) I just want a big screen that won't hurt my eyes too much.
P.S.
I'm not even gonna talk about iOS (has become boring and a bit stale. There's just so much you can add to the same OS until it starts acting glitchy) A lot of apps, sure, but Android is catching up incredibly