Not to discount the size of the launch, but it's estimated that 77% of iPhone 4 purchases were upgrades from earlier-generation iPhones. Still an impressive launch, but Apple didn't grow their marketshare by 3 million handsets.

http://tech.fortune.cnn.com/2010/06/25/77-of-iphone-4-sales-...

And those iPhone 3G(S) that were being replaced were simply thrown in the bin? Or were they passed on to the second hand market?

My fiancee's 3GS was passed to me, and my iPhone 1 was thrown in the bin.

For sure iPhone 2Gs are being thrown out at this point. But are Android phones' stale dates any better? They much much worse.

Getting 700,000 users in one weekend is nothing to be ashamed of. And quite likely enough to pull the gap much closer, or reverse it to put the iPhone back at top.