The iPhone 6s was the first iPhone with more than 1gb of RAM. So, at least in that ecosystem, there's a long history of tight memory constraints. In non-Western countries there are lots of cheap and not-so-well specced Android phones, too.
I know what you mean, but most phones don't even have 2GB. Most <$200 Android phones still have 512MB or 1GB. iPhones are notorious for lacking memory compared to their cost and a broken virtual memory system.
Also, I have an insane amount of tabs open in chrome. I'm not sure what the rule is, but it seems like it keeps ~5 tabs in memory, depending on how much is in the current tab. (Tangent: Opera has a great offline feature for saving stuff before you get on the plane.)
I'm actually a little amazed than I can scroll pinterest or tumblr as well as I can.
You're right, the price point has shifted. I don't know about Xiaomi, but phones like the Moto G 3rd gen and comparable Samsung/LG/HTC/Google phones with 2GB are above US$200.
I'd also caution that the prices for US consumers on Amazon are far lower than what is experienced in smaller markets, which have much less competition and fatter telcos. Massive monoply power at work, most tech simply never makes it to many countries at all.
Outside of the US, the telcos generally aren't controlling the market for phones; import tariffs can be pretty high though, and divergent frequency plans segment the world market as well.
In many countries people still pay for their phone as part of their phone plan. Whether that is due to a lack of credit, some perception they get a discount or just habit, its a real thing. Many people only buy a phone outright after they break the one they have on a two year contract.
I was recently in Thailand, and even in major metro areas it was obvious that most shops were owned by a cabal of monopolistic fat cats. Similar situation in many parts of the middle east. Prices for equipment which would just work with a direct import (like iphones) are ridiculous.
Yes. Your phone is limited. Most of the phones max the VM's to something like 128 MB. For a while you couldn't easily move to a large, per app memory size. Even today the apps you run are probably doing so with just 128 MB caps.
I'm still running my moto g with 4gb of ram and it performs perfectly fine, even on latest android. If the moto g has aged so well I can guarantee you the market share of phones with <= 4gb ram is quite large.