How do you think we got to a 4.7-5" phone? We didn't just jump from 3.5 and 4 inchers to 5 inchers. Phones got larger and larger, and the demand/sales (I assume) got better as they got larger. Likewise, demand for smaller tablets came from the other way, and it was only inevitable until companies married phone features to tablet sizes.
And 3.5-4.5" phones sold very well. Look at all iPhone sales that aren't the iPhone 5! The problem is just that at the time of the first few iPhones, Android devices only had one way they could compete against the iPhone, and that was with a bigger screen. And at the time you couldn't get an iPhone if you weren't on AT&T. So your options have always been constrained.
Total sales of 3.5-4.5" high end devices have never been awful. But as the market grew, devices in that category are largely made of crap hardware.
I do agree I wish there are even more options for all sizes. It is a shame that my sister, who wants a mid-size phone, will have to settle for mid-range specs, but to call those specs "crap" (you've now changed it to "not high-end" which is far more accurate) is simply not true.
I haven't changed my argument at all. Go look at any Android phone under 4" and the hardware will be crap compared to flagships above 4.7".
We have far more choices than we ever did before.
Just because we have a lot of choices doesn't necessarily mean we have a wide range of variety. You can have 50 different phones to choose from all of which are 4.7-5.0". Or you could have 50 different phones to choose from ranging between 3.0-5.0". In each scenario you have the same amount of choices, but one clearly brings more variety in terms of screen size. Now scale this example out to include RAM, CPU, camera, and ppi in addition to previously mentioned screen size. A majority of the high end options are clearly above 4.7". Go below 4" and all you get is crap hardware.
Hopefully we'll have even more if these "mini" versions of the S4, HTC One, Moto XFon, etc. sell well. Google has also stated they're committed to bringing mid-size phones with higher end specs back into the game.
The only one of those that actually exists at this point is the S4 Mini. And I hope you aren't actually trying to argue that the S4 Mini has high end specs, because that would be a short debate. Not to mention it is still above the 4" mark. Go below that and hardware gets even worse.
Give it time and hope the market repsonds.
That is exactly the problem. The variety that some customers want just isn't available yet. People don't want to wait 1-2 years without a phone to get one that works best for them. Basically what I am saying is that manufacturers need to address this problem sooner rather than later. Yes, with time more of these phones could come out. But at this point, things are only getting worse with no evidence to support that high end Android phones below 4.5" will actually exist anytime soon.
The screen is crap: 