From what I understand, they aren't dropping the hardware. Instead they are using the hardware in order to sell the OS to hardware manufacturers. Also, as usual with startups, that's just the current plan used to milk capital from venture capitalists. I'm sure they'll go with whatever business model that allows them to pay for salaries and investors.

Not asked from me, but I would like to answer anyway.

Yeah, there will be high end phones 6 years from now on, with the same ridicilous profit margins as today. But it will just Apple and maybe Samsung (or whoever might take Samsung's spot) selling those. Apple because of what they do and because they have literally several decades of experience in selling with high-end pricing in mature markets (Macintosh). Samsung / someone else besides Apple because there will be enough people with too much money to spend on phones six years from now.

But the smartdevice market will have matured by then and both by far and overwhelmingly most of money will be on the gray devices, as you put it. Maybe -and hopefully- Jolla will have big enough share of that enormous piece of pie.