Most people would rather pay $200 for an iPhone or Android and pay $100/month on a 2 year contract, rather than buy the device for $700 and pay half the monthly in prepaid.
GSM phones work on AT&T and T-Mobile but the 3G bands are different. T-Mobile still uses AWS for the most part while the other carriers do not. So if you're switching to/from T-Mobile you'll end up buying a new phone if you need 3G (or 4G).
I doubt that. If we are speaking for most people then most people want a free iphone or idroid and a lower monthly fee. The rest dont care what it cost upfront or monthly and are not the ones bitching. they are too dumb and high to even care about doing the math. shutup and take my money! So i can tell everyone about my new phone already! And post speedtest! Look i have LTE!
Btw, unlocked pentiband smartphones are cheap and widely avail.