By whose reckoning? Look, I'm not defending VZW's pricing. I'm simply pointing out that it is firms, not individual customers, who determine pricing. They may well respond to market pressures, but only if they are forced to do so. There is no such thing in a market as a way to evaluate whether consumers are "paying well more than enough" to do anything. If consumers pay the price that is what the service is "worth."
In this particular case, consumers are their own worst enemy. By insisting on cheap, subsidized phones they provide a cushion for VZW and other carriers through multi-year contracts.
The EU figured this out years ago. That's why GSM networks are the rule, not the exception in Europe. If consumers find that they are being overcharged, they can take their business elsewhere simply by replacing a SIM chip. And by separating the purchase of a phone from the selection of a carrier, the latter must respond to market pressure. In the US, any concerted market pressure is blunted by consumers locked into multi-year contracts.
In short, if you want your carrier to pay for your phone, be prepared to have little leverage over their pricing policies.
