What hardware doesn't it include which can account for the $400 price difference between Touch and iPhone (same goes for Android phones also). I would love to

What hardware doesn't it include which can account for the $400 price difference between Touch and iPhone (same goes for Android phones also). I would love to be proven wrong that there is some objective reason why the cellphone chip and a GPS chip would add $400 to a device (standalone cellphone and GPS together will cost less than $100, so the bare chips should be much less).