Mainly because there is not a phone made that should cost anywhere near $800 full retail. $300 would be a fair price and fair profit for any of these phone makers and resellers. This includes the iPhone the Galaxy and any other that has been produced in the last 5+ years.
It is the subsidies of the phone companies that have kept the retail price of these phones so high and we will all see that as this becomes common place the market settles in a year or 2.
Agreed. If AT&T goes ahead with this, Apple will either be substantially re-thinking the way they price their devices, or their marketshare in the US will start free-falling. In the Android world, if the bigger, more established players don't want to start lowing prices, ZTE, Hauwei, and others will do it for them.