I paid US$500 for my current iPhone, which is about half that price, and just about the top of what I'd be willing to pay for a device with a useful life as short as that of your average smartphone. Should I seriously expect to be coughing up 100% more to replace my current phone if it craps out?
No thanks. Those sorts of hijinks make Nokia's bananaphone look more and more attractive.
It's the middle end by average sales price -- about half of people pay less than that, about half pay more. Check out https://twitter.com/asymco/status/1040240778860146688 for the whole picture.
Android isn't an equivalent replacement, but I can adapt.
The cheapest new iPhone is $449.99 which works out to 360$ in 2007 dollars. The cheapest original iPhone was $599 in 2007 dollars or the equivalent to ~750$ today, making them far more affordable.
What really changed is cellphone companies stopped baking in heavy phones subsidies. Now you can still pay next to nothing at purchase, you just see a separate monthly fee on every cellphone bill.