If consumers paid out of pocket for their phones then they would be more picky about upgrading and plan prices. It would also make upselling shitty plan features harder so the carriers would loose a lot of money.
Cheaper phones by definition have slimmer margins.
I find that markets that are financialized where the price of the good is obfuscated are less efficient. This is because efficient markets rely on price discovery. Healthcare is an excellent example of this.
And in store there's clearly the price tag right beside the demo model.
So hard to see how its obsfucated like healthcare.
Or is there some carrier that sells the expensive $1000+ phones on prepaid plans?
The locked phones are usually sub $250 and have some kind of finacial gimmick to get the sticker price lower. Often it will be some carrier specific model name. Just sort by price low to high and you'll find them.
ATT, Verizon, and Tmobile are selling many many expensive phones, locked, on 24 momth payment plans, literally hundreds of possible configurations of dozens of models.