You can get an iPhone on contract for cheaper or the same price, with MUCH better hardware. I paid 400 dollars for a 64gb Touch and I sincerely hope they don't still charge this much for the device because that is way over priced for gimped hardware. The same thing will happen to the Touch 5 as the 4. The GPU is already only barely ideal for newer games and will fall behind before the end of the year. Anyone who says there is enough RAM because of no phone overhead is clueless too. Just own a Touch and find out, like I do. I can't even scroll through web pages without it lagging horribly. My Nexus One from Jan 2010 destroys my iPod touch 4 in responsiveness and with the amount of lag on every task except for 3D games, which I don't bother with on my N1.
Take a 100 dollars off every model of Touch and I'd say hey, not bad for the price. Sad thing is this is supposed to be the gaming device but the iPhone handles any 3D game MUCH better. Gimped hardware should come along with a gimped price, but that isn't the case with the iPod Touch. Just get rid of it Apple and replace it with the Mini. Problem solved. Can't freakin wait to get rid of this thing and get an iPhone.