If you weren't a short who can't make money, you wouldn't mind the price. Anyway, when you have a quality product, you NEVER compete on price. Once a price is lowered, or temporarily discounted, you can never raise it again.
they need a low cost entry level phone. not sure what they should leave out that would allow it to be cheaper though. especially since they don't last the through the two year agreement and you inevitably end up having to buy a phone outright.