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> either 64GB iPhone is overpriced or the 32GB is underpriced, or both

The problem is that there isn't a 32GB iPhone 6s, though it would only cost Apple a few pennies per unit to offer one. Instead, it has a 16GB version (too little storage) and then jumps to a 64GB version (which is comparatively overpriced).

Either way, purely in terms of manufacturing costs, it's a choice between "overpriced" and "even more overpriced" -- or, if it makes you feel better, "premium priced" and "even more premium priced". I don't think "subsidising" comes into it.



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