$99 iPhone at Walmart post-Xmas?!

Bloomberg reports that employees contacted at five California Wal-Marts have confirmed that their stores are indeed gearing up to sell the iPhone in the near future. There’s no confirmation on the price point, though.

Analyst Shaw Wu of Kaufman Bros. in San Francisco called a $99 iPhone “inevitable” in a Dec. 5th note, but Apple’s selling a $99 4GB 3G at Wal-Mart still strikes us as highly unlikely.

Earlier today, The Boy Genius Report posted a provocative tipoff: Apple and Walmart are hatching a plot to sell 4GB iPhone 3Gs for $99 with a two-year contract after this Christmas. BGR is treating this piece of info with healthy skepticism, since the tipster isn’t one of the site’s regulars. We are going to go ahead and dismiss it outright.

It would make perfect sense for Apple to push a discounted model through a mass-market retail channel like Walmart to jack up the install base… but it doesn’t need to go all the way down to $99; $149 or even $199 would push volume without sticking Apple with outrageous per-unit losses. Furthermore, we are sure that Apple doesn’t want to divert too much retail traffic from its lucrative stores, where they sell accessories and Mac stuff by the boatload to new iPhone customers.

And then there’s the network side–AT&T is always interested in picking up new subscribers, but how do you think its already shaky 3G network would hold up if Walmart opened the floodgates to millions of newcomers? Jacking up bandwidth demand like that without careful planning (and substantial investment) is a recipe for disaster.

No, sir! We don’t buy it.

[from Boy Genius Report.]

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