You can purchase a new phone (full price) directly from a cell carrier or use a phone you have (GSM phones only work with T-Mobile and AT&T) and avoid a security deposit by choosing a pre-pay plan. T-Mobile has Flex Pay, which gives you the benefits of a plan but you pay ahead of time instead...
You would need to read your contract to see what is stipulated in it. However, I do not think what you describe would allow you to terminate the contract without being liable for the fee for breaking the contract. Sorry:(