well i think the reason why they couldn't launch this as a 4s replacement is because of the physical limitations of the 4s. (A5, no LTE, etc).
Next year though, the iPhone line will be very interesting. They might discontinue the 5s for the 6? But I think they're more likely to keep 2 Gens in each category, so you'll have iPhone 5s, iPhone 6 for the high end, and the 5C and 5CS ??? for the mid end, at the prices of the current 4s.