Well, I live in Germany. I own my phone, and have a prepaid contract (Tchibo in case anyone is interested) with a flat rate for data (500 MB max - after that speed drops). Costs me EU 10 / month plus whatever phone calls I actually make (not a lot, I suppose I could get it down to zero if I'd always use Skype). I can switch to another provider at any time, although taking the phone number with me is a hassle.
I use the phone to watch videos when I ride the subway to work, I have an app to get the public transport schedule, and another to buy rail tickets (I don't even need to print it, the conductor can scan it from the screen of the phone). I use the GPS, surf the internet, check my private mail (my employer can buy me a phone if they want me to check my company mail) keep my appointments, maintain my shopping list, check the weather forecast, listen to mp3s and there are a few games to keep my little daughter entertained when we are in a restaurant. (Mainly painting programs and "fruit slice" - she likes these.)
Occasionally I read books on it, too - but that's limited by my personal antipathy against DRM. Also I take photographs and videos sometimes.
A lot of fun and a lot of utility for the price. What's going on in the US these days?