If you're not getting updates from the chip vendor, you're going to have a hard time moving to later version of Linux, for example. It would cost a lot of money to port new software to the platform, and then the question is... who's going to pay for it?
If everyone still using a Nexus 5X chips in $50 USD to fund continued development, then maybe that could continue. But it is easier at some point to just buy a new phone.
> The phone originally sold for $400. Is that really not enough money to fund software development for 4 years or more?
No, not really.
First comes the reality of retail pricing. The "leaving the factory door with everything amortized in" unit price of a $400 phone is likely around $250 or less. The rest of that is markup for the store, shipping, warranty returns, marketing, and a bunch else.
A good chuck of that $250 (if it is even that high), pays for the actual hardware, patent licenses, carrier testing, and a bunch of other stuff.
That doesn't leave much left to actually pay for development.
And since most consumers aren't thinking about operating system updates a couple years down the road, the lower selling price will generate more profits than long-term support will.
1. If it was really $400, the problem is most ( pretty much all apart from Apple ) gives plenty of Retail margin and incentive to carriers. That means on average it is highly likely not even getting $250 out of it.
It is like those Flagship Samsung and Huawei phone, their pricing strategy is always $100 lower than comparative official iPhone price, except they are often retailing for 20% lower. Compared to Apple, you could hardly find any decent discount on iPhone, and iPhone has much lower margin for Carrier and Retail, from low end of 10s to even single digit percentage.
2. Only if it is sold for 100 millions unit +. And Google didn't even manage 10. You need Scale for it to work. That is why iPhone is unprecedented, when was the last time you saw a product in its segment taking 20% of shipment and 80-90% of industry profits?
The answer often to all these question is simple, paid up, and find enough people to paid up, in business terms this means market fit. Unfortunately apart from small bunch of people on HN, no one is willing to paid extra $50 - $100 more just for Software update, they expect it to be free, or they would rather not update at all.
And more to your point - The iPhone 7 is currently 450$ brand new and is nearly 3 years old. Not only has it received feature updates for those 3 years, but all it's predecessors down to the 5S have been receiving feature updates (ends this year unfortunately) - we should be able to expect the iPhone 7 to at least get another year or two of feature updates.
