Meanwhile, your friend Susan buys $200 for the phone, and signs up for the same service at the same $80/month.

The only difference is that she promised to pay a fee if she decides to switch carriers in the next two years.

Do you still think the phone is really priced at $650? To me, it seems like some fairly trivial market segmentation. The phone's regular price is $200, but they're making some extra money from people who place an abnormally high value on being able to switch providers on a whim.

In Europe, that's a down payment on a standard financing deal, and after the phone has been paid off, your monthly bill goes down.

In America, that's the price to straight-up purchase the phone. Your monthly bill will be the same regardless of whether you bought your phone from the carrier, or brought your own.