The retail price of a device is set by the manufacturer, not VZW or any other carrier. The subsidized price is set by the carrier, which they don't have to do, but in order to make them affordable for John Q. Public, they gladly do so that you will pay for their respective service. This is why Amazon can sell smartphones for a penny, and Verizon sells them for $299. As technology moves forward, the newest technology will always be expensive, and get cheaper as time goes on, but the price of small tablet computers that you can make phone calls on and navigate to Grandma's house for the holidays, will remain high, and I am glad that VZW will make it cheaper for me as long as I stay with them.