To me this is as stupid as Intel refusing to support USB3 for the sake of "moving on". That worked out well...
> The fact that my headphones need a AAA battery
Just because some headphones do not need batteries says nothing about these specific headphones being talked about. Both can exist at the same time (a pair that requires batteries, and many that do not.)
For example, Bose Noise-Cancelling Headphones, which are quite popular, require AAA batteries:
http://worldwide.bose.com/productsupport/en_us/web/qc15/page...
They will buy Apple Product X, they will buy Apple Product Y.
Anyone who believes profit is the most potent measure of success can always point at Apple and say "those people are doing the right thing".
I don't personally hold the view that this directly reflects a company's innovative quality, but again if that's the measuring stick, it only seems to further the argument that Apple's design decisions aren't what they used to be.
In this case, the past few days would tend to counter your thesis. Also, the current dip is shorter than the one from Sep '12 to Jul '14, at which point they rebounded dramatically and pushed ever-higher highs. Do you believe they stopped making good design decisions around then?
Music on an iPhone should have uniformly very high quality because Apple got rid of the analog port. Apple has also set a high baseline for 3rd party products.
This is good for audio quality, good for customers, and good for the brand.
Sure, the 'tablet' market is still ongoing, but then PDAs existed before the iPad - the concept wasn't anything new.