It basically is that - most owners replace their iPhones regularly, and if you replace your iPhone with purchase price $P every M months, that's just as good for Apple as you paying P/M per month, with some additional benefits:

The user is locked in to a large minimum spend; the user is responsible for EOL disposal of the device; the users perform self price discrimination, where more wealthy users replace their phone more often so effectively pay a higher monthly rate.

Too overt. Why not just keep slowing it down until it compares poorly and you upgrade to the new snappier version?