Reports: Wal-Mart May Sell $99 iPhone

Wal-Mart may soon start selling a $99 Apple iPhone, according to several reports.

Rumors began circulating on Apple-related blogs late last week that the retailing giant would have a low-end version of the still-hot gadget in stores by New Year's Eve.

Over the weekend, Wal-Mart sources told the San Jose Mercury News and Bloomberg News that Wal-Mart would indeed be selling iPhones, but couldn't confirm that a $99 model would be among them.

"It's going to be very soon," the manager of a Wal-Mart in Fremont, Calif., told the Mercury News. "Originally they were going to release it before Christmas, but they can't get them that fast to us."

Professional Apple watchers told Bloomberg they expected the company would use Wal-Mart to clean out the backlog of 4GB iPhones, which were sold for only three months before being discontinued in September 2007, or maybe even resurrect the model.

"A $99, Apple-branded cell phone is inevitable," Kaufman Brothers analyst Shaw Wu said. "One of the key things Apple needs to do to drive broader iPhone adoption is to build a more complete product line."

Officials from Apple, AT&T and Wal-Mart all declined to confirm any part of the story to either Bloomberg or the Mercury News.

Currently available iPhones are an 8GB model, which sells for $199 with a two-year AT&T service contract, and a 16GB model that goes for $299.

Apple scored a coup in the third quarter of 2008 by seizing the lead in U.S. smartphone sales from longtime market leader Research In Motion, makers of the ubiquitous BlackBerry line. RIM released three new, media-friendly models in the fourth quarter that are expected to eat into the iPhone's sales.

• Click here to read the San Jose Mercury News report.

• Click here to read the Bloomberg News report.

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