Not true- they still sell the iPhone 4 as a cut-price version of the 4S. And they sold the 3GS when the 4 was the top model. Expect them to do the same- sell the 4S alongside the 5.
I assume that once the 5 ships, the 4S will become the cheaper model, and the 4 will become the really-cheap model that the 3GS currently is.