I note Huawei are about to release a phone in the U.S. which will retail for $1300. Research has shown that consumers want all the latest features in their smartphones and whilst no one wants to see prices rise they are more than willing to pay premium prices.
You have only to look at iPhone shipments for 2015 to see that.
Most people have contracts or some sort of payment plan which disguise the true cost of the phone. If they had to pay the full price upfront then sales would plummet!!