But I'm not quite sure that Apple would be the worse off compared to others. I does not really matter whether or not a brand has current plan for the low end: if people expectation are set to high-end phone == free, I'm not sure why they would want an low end phone unless what, you pay them ? What really matter is what brand has an alternative way of funding those phones. IMO that means killing "open" Android, anything open really.
Apple can still rely on the App Store and its walled-garden. MS tiny markeshare will probably make them give up under the risk of bleeding to death. Samsung has enough marketshare to build its own walled garden. Google would have some thinking to do, I'm sure other brand will start to question how valuable their client really are for Goolge. As for the rest of the Android player, RIM, ... well good luck.
"It is also shows that Apple’s worst nightmare may be coming true: prices could fall not just for cheap phones in developing markets but higher-end ones too."
But there is no discussion of wether this really is a high end phone. Looking at existing Kindle tablet, I'm going to guess that it will be mid-range or upper low end, depending on how you define those terms. Free low end could force prices down on the high end, but thats not really a slam dunk case.