That of mobile phones hardware and firmware is a very mature industry that still has many competitors.
What it means is that everybody must keep their prices as low as possible if they want somebody to buy the phones that mount their components. To the point that, for low-end Android phones, chip and firmware manufacturers have basically no profit margins.
So what do you do when you have nearly no profit margins and no way out of it? Simple: you create profit margins out of thin air by pre-installing spyware on the firmware itself. The phone comes out of the box with the spyware already installed.
There's apparently a big market down there with dozens of available plugins. From gathering data from your SMS texts, to sniffing Facebook sessions, to accessing your location data, to shoveling custom ads, up to selling “device time” to criminals for all kind of purposes (just like you can rent an AWS node on the fly for a few hours, criminals can also rent access to somebody's phones for slots of up to 5 minutes to do whatever they want with it).
If a phone (or a smartwatch, or a smart TV) looks too cheap to be true, it's because it is. Devices like the Fairphone or Librem may be a bit more expensive at parity of features, but you're paying the right not to have surveillance pre-installed on those devices.
Quando una cosa è gratuita sei tu il prodotto.