It's not important that it's 7x better. It's important that the increase in productivity (or enjoyment, etc.) is enough to justify the $600 difference in price over a (perhaps) 24 month period (e.g., do you get ~$1/day more out of it).

Not to mention, a 2 year old iPhone will probably sell for $250-350, while a $100 smartphone will probably sell for $25 after 2 years. This makes the difference more like $300. So, "Do you get ~$0.50/day more out of an iPhone than you do out of a $100 smartphone?" becomes the new question.