If most phones are unlocked the market will certainly come up with competitive prices for both phones and carrier deals. That's how it basically works in the no

If most phones are unlocked the market will certainly come up with competitive prices for both phones and carrier deals. That's how it basically works in the non-US systems. As long as the phone is bundled with, say, a 24 month service you'll definitely end up paying more and the nominal "plain phone prices" can be arbitrary. You don't get $500 for "free" as the real price of the phone would be much lower. Or, alternatively, the monthly charge would be much lower without the phone if there was competition there. It's just that contracts are too lucrative for telcos and they all know it, and nobody wants to start the competition.