Why does it cost an extra $100 for more storage in an iPhone?

I can go out and get a 16GB flash drive for less than $15, but to put the same storage in an iPhone it costs an additional $100?
Any idea why? Or are they just ripping us off?

The built in phone storage is quicker than the SD card but even so, in a nutshell, yes, they are ripping us off. They know people that want that storage can and will pay for it.

That is the Apple way.

Inbuilt storage is faster than memory cards and also considered more reliable.

Also iPhone from apple isn't the only one who charge premium for internal storage, if you check on amazon the 32gb Galaxy S4/HTC One are around $800 which makes them asking for $200 premium for additional 16GB of internal storage.

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