Why is the iPhone so expensive?

No really, it's not more complex than any other phone. In fact I would say that it's simpler. Really it should be less than a lot of the top end smart phones.

The components of the iPhone are pretty simple in phone terms. It has no keyboard so that is quite a big saving. It has a larger screen but the resolution is no greater so that should be cheaper to manufacturer. It has a touch screen but so do the ?SonyEricsson P800, P900, and P1i. It has no 3G setup and all the RF electronics that have to go with that. The one difference it may have is that the video and CPU chipsets may be slightly beefier than some others but no by much I would wager. So why should people pay and extra £200 or so over the two years of the contract? ( This may be more as I think that data tariffs are going to drop pretty soon. 3 already do all you can eat data from your phone for a fiver a month)