Sorry i should have added flagship..
Even still, taking this as an example the estimated raw component cost of an Iphone XS Max is $453, already close to half a thousand dollars before even manufacturing costs, R&D, software development, engineers salaries, logistics, advertising etc, I'm not saying Apple are a charity, far from it but you can see how that easily becomes a thousand dollar phone.
I appreciate there is a market for these high end phones because at least it helps push the envelope forward and eventually the new features and tech trickles down to the midrange handsets.
Really even the flagship phones sitting around £800-£1000 imo I think it's truly amazing what these devices can do now, the power that they have, I have a Mate 20x and I barely even feel the need to pack my SLR camera these days, I enjoy having a good PUBG session on it from time to time, watch movies in HDR with dolby atmos stereo speakers, use my finger print to pay for goods, do all my banking in the palm of my hand, enjoy having all my music with me 24/7 at CD quality, and I haven't even touched on the business/productivity side of it of which it is invaluable for me.
I have a PC that is now 8 years old, I choose to upgrade my phone over upgrading my system in the end, it wasn't a decision taken lightly, but thinking it over my phone was more important to me, not just in terms of entertainment, but also as a productivity tool, 5 years ago I wouldn't even of dreamed doing that, but with the top end phones being as powerful as they are they are now they are replacing a lot of what I might of chosen to do on a laptop or home PC not so long also.
I do believe sometimes people undervalue the importance of a good smartphone, there are plenty of good cheap phones out there now that are very capable, but more expensive phones also have their merits and use cases to, for many people a phone is an intrinsic part of their life, capturing their most cherished memories, helping you run your business, entertaining you, how much value do you put on a device like that?
I guess at the end of the day that's up to you.