you are missing the fact that some people are tied into contracts with other networks, and have good deals elsewhere.
I am with vodafone on a 12 month contract - £10 per month, stop the clock minutes, unlimited data. Everything I want/need for £10 per month - i've been with them for a while and pushed for the best sim only deal I could get!
First I was worried the 3g iphone would be difficult to unlock because of not being able to get it without activating it. Now i'm not so worried, with o2 saying you can buy it online.