It's a combination of technology and marketing. The lower-cost phones
indeed do have fewer advanced features and can be made at a lower
cost. The introductory phones will basically be good only for making
phone calls. You can forget about browsing the Internetl, taking
pictures with a built-in camera, etc.

The higher-end phones are made with advanced features that often cater
to business-oriented users. For example, a Treo handheld can basically
do all the common communication functions a business person might
want, including browsing standard Internet sites, sending and
receiving e-mails, opening file attachments, etc. That functionality
costs more to include in a phone.

As for subsidies, more actual dollars are spent on subsidizing the
higher-cost phones because those people represent higher-margin
customers. Given the fact that phone companies buy their devices in
bulk, they can get entry-level phones at relatively low cost and still
afford to give those customers subsidies.

No, there aren't.

There are many phones *discounted* to $50 or less, but there are no phones
that actually retail for that low an amount.

It's definatly not the technology.

Features. Things like cameras, more memory positions for say 500 phone book
entries instead of 250, (some like) flip phones, bluetooth, infared etc.....
It's the othere thngs that make them cost and not the technology.

Easy.  Features!  You can get a Nokia 2190 which is extremely no
frills and will get the job done or you can spend thousands of dollars
for a Vertu.  Each has a market and a need.  Not everyone needs a
phone that has precious gemstones in it and likewise not everyone
needs a barebones simple phone either.
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