At the unlocked price of $550 for the iPhone 5c and $650 for the considerably-better iPhone 5s, it doesn't seem like there's a huge price gap here. I have doubts whether it'll sell that well as the mid-level smartphone. The 4s is $450, which is closer to the price point I would have expected.
The price gap is in a way even worse subsidized because it is still just a $100 discount up front but the same price per month for the same contract length for a lesser phone. The 5C doesn't make much sense to me beyond people that really want more choice in the color of their phone.
It's really hard to get the average smartphone buyer to understand the price isn't $100 vs $200, but really $2500 vs $2600 over two years.