From $299 to $199, Nexus 4 managed to become the first high-end smartphone that costs less than $200 off contract. Google's previous Nexus phones used to cost about $529, but Nexus 4 changed all that. Google subsidized the phone in an effort to make the phone more affordable.
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It's amazing to see how much has changed since 2010, when Google released the first Nexus device: Nexus One. Hardware has improved a lot, Android has a great interface, Android apps are better, Google built a content store, Android is the leading mobile OS and you can buy powerful phones and tablets for about $200 (full price).
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