The original iPhone was 600 dollars ON contract, which was later dropped to 500.
Yes, some people figured out how to crack the SIM-lock, so they could use a different sim card and not activate the AT&T contract that you were supposed to activate when first connecting it to iTunes, but that's an edge case that doesn't change the fact that it was sold on contract.
The 650 dollar price for iphone 6 is OFF contract. So the iPhone price has significantly dropped over the years.
The original iPhone was on contract but unsubsidized. The iPhone 3G was launched at $199 with a 2 year contract and every iPhone since then has stuck exactly at that price point at launch.
Yes, some people figured out how to crack the SIM-lock, so they could use a different sim card and not activate the AT&T contract that you were supposed to activate when first connecting it to iTunes, but that's an edge case that doesn't change the fact that it was sold on contract.
The 650 dollar price for iphone 6 is OFF contract. So the iPhone price has significantly dropped over the years.