I would guess one niche is people that wanted the 7 inches tablets and ipad mini to succeed more. They opted for cellular models, and would have prefered to be able to message and take calls there, getting rid of their phone altogether (that’s one less device to care about).

Another niche is people who used their phone mostly as a notification device, but switched to the watch for that, and now are frustrated by the tininess of the phone as they use it more and more for “serious” business only.

I am not in any of these niches, but also feel that I am happy with a smaller phone only because I need to pocket it. If I was using a purse everywhere I’d want the biggest thing I can get away with.