I would argue that the _only_ way you can come in to the phone market is through the high end.

In order to sell at the low end, you need to sell a lot. A new company doesn't have the market share to make a low end phone with almost no margin profitable in any reasonable amount of time.

On top of which, people with the money to buy high end phones are the ones with the money to throw away their perfectly fine phone in order to get the latest and greatest toys, and the ones that want to do so so they can brag that they have this cool phone that not that many people know about.

The main problem was not the price, it was the execution. False promises, late releases, poor support, general lack of transparency. The execution was abysmal, but people were willing to pay the price.