I used to live (stationed) in Europe where people buy cell phones from their local electronics retailer.  Since these phones work on all carrier networks (unlocked), there are no contracts and their prices are equivalent to what you would pay for a two year contract phone here.  These phones are also made by prominent manufacturers too such as Motorola, Samsung, Sony/Ericsson, Nokia, LG, etc...   Then you choose your carrier (SIM card), usually by some flat rate monthly fee that doesn't calculate minutes or data usage, unless you're calling internationally. And both manufacturers and providers are fiercely competing for your business. 

So when you have long term contracts and service providers selling only proprietary phones locked on their network, that takes a lot of the competition, and customer loyalty, out of the picture.   Just my $.02