The last 30% decrease in cost to manufacture handsets (parts, including flash memory) was NEVER PASSED ALONG TO CONSUMERS. That and the fact that rates for post paid accounts are very high compares with pre-paid accounts which to date have crappy phones... make for a market which has an OVERSUPPLY of handsets compared to demand for each segment (prepaid vs postpaid). Unless some crossover of smart handsets happens to the prepaid market. There will continue to be an oversupply of handsets both regular and smart ones. SOME consumers would be willing to pay the higher upfront costs of a handset (less subsidized than postpaid contract acccounts) with a prepaid service that tops $50 for unlimited services including voice, data, text, im, web, internet etc (without any contract requirements or extra fees/taxes/surcharges added on), however that would cannibalize the post paid market.. so, as the pressure mounts, we wait with bated breath to see which carrier is most desperate for customers to make this happen.