Interestingly, I just went through this. First, I had to convince my wife that the phones *do* need to cost that much when I went out and bought three plain ol' phones and one Nexus 5 at retail. The total for all of it was about 600 bucks after I found three unlocked phones on Ebay. That's a big amount of money, and that's all she was looking at. However, when we went to the local AT&T store to set it all up, the manager admitted this is the smart way to do it because it's cheaper in the long run. And, if something better comes along, I can change plans without fear of an early termination fee (as long as it's another GSM network). So I have a plan that has two more devices than my old contracted plan, includes more talk time, more text messages, and costs 40 bucks less. I had to give up my unlimited data, but I have never used more than six gigs in a month between two devices, and my new plan allows much more than that. I don't have to pay an extra tethering fee. I don't have to worry about when I can upgrade again. It goes on and on. And now I don't need a home phone, so I killed that and lowered my internet/cable TV bill by 30 bucks a month.