I know that some people want iPhones that are 6.5″ diagonally, as the current rumors are suggesting. But having a 5.8″ phone as the smallest current-generation option is going to make a lot of people unhappy.
Different people have different needs, sure, but no one with average-sized or smaller hands can use such a phone comfortably with one hand. Why would you make all of the new phones so large?