Wal-Mart waffles on reports of $99 iPhone 3G

Answering an inquiry from BetaNews about Wal-Mart's reputed plans to sell an iPhone 3G for $99, a spokesperson today issued a statement that neither confirms nor denies the rumors.

"We have made no official announcement on offering the iPhone at Wal-Mart," said spokesperson Kelly Cheeseman today, when asked by BetaNews for comment on published reports that the retail chain will start selling a 4 GB version of Apple's iPhone 3G for $99 just before New Year's Day.

The accounts originated on the Boy Genius Report blog before being picked up by other media. In November, BGR pointed to an internal memo at Wal-Mart announcing that Wal-Mart has reached agreement with Apple to sell an iPhone at "Wal-Mart and WalMart-managed Sam's Club Connection Centers nationwide beginning December 28."

Then yesterday, BGR cited unnamed sources as stating that Apple might be looking at coming up with a vastly upgraded version of its phased out 4 GB iPhone and permitting Wal-Mart to sell a 4 GB 3G device for just $99 with a two-year contract. BGR didn't seem to trust those sources entirely, however. "Don't hate us if this doesn't happen," readers were cautioned.

The reports actually seem somewhat feasible, though, given a similar deal struck recently by Wal-Mart for the Android-based G1 phone, along with current pricing for higher-end models of Apple's iPhone 3G.

Wal-Mart has already been selling G1s for $148.88, or about $31 less than wireless carrier T-Mobile is charging for the same phones.

Apple's present iPhone product line encompasses an 8 GB model priced at $199 and a 16 GB model for $299, both with two-year service contracts from AT&T. Apple briefly carried a 4 GB of the first-generation iPhone during 2007 for $399 -- but the company abandoned that product after lowering the price of its 8 GB first-generation model in an attempt at increased sales.

Meanwhile, a number of financial analysts have issued reports intimating that Apple has made so much money from the iPhone so far that it can well afford to sell a $99 iPhone, in the event that the $199 price tag becomes too steep for users financially strapped by the current economic crisis.

As a possible motive for Apple to do just that, Charlie Wolf, an analyst for Needham & Company, suggested a desire by Apple to further boost its growing share of the smartphone market to the point of almost total domination.

"In short, the iPhone...could figuratively take over the smartphone market leaving only niche players like [RIM]'s BlackBerry," according to the analyst.

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