Wal-Mart slashes iPhone price to $97

By Chavon Sutton, staff reporter


NEW YORK (CNNMoney.com) -- Wal-Mart, the world's largest retailer, plans to slash the price of Apple's 16GB 3GS iPhone to $97 beginning Tuesday.

Apple (AAPL, Fortune 500) is widely expected to unveil a brand-new iPhone next month, and could be working with retailers to clear out its remaining inventory of the about-to-be-outdated model.

At the new price, customers will save $100 on Apple's smart phone, which currently sells for $199. The deal requires that the phone be purchased with a two-year contract from AT&T, the iPhone's exclusive service provider.

"It is our commitment to always lead on price," Mehrdad Akbar, Wal-Mart's (WMT, Fortune 500) senior category director for wireless, in a prepared statement about the price change.

Apple sold 8.3 million iPhones last quarter, more than twice the amount sold during the same period a year ago.

Wal-Mart's pre-Memorial Day price whack comes as technology giants such as Google (GOOG, Fortune 500), Research in Motion (RIM) and Hewlett-Packard (HPQ, Fortune 500), which recently snapped up Palm, vie for top dog status in the smart phone market. Industry analysts say that worldwide smart phone sales topped 54 million units in the first quarter, up nearly 49% from a year ago.

At $97, Wal-Mart's price slightly undercuts the $99 price tag several analysts anticipated for the remaining iPhone 3GS stock. When consumers get sight of a new iPhone model on the horizon, sales of the existing model typically falls off sharply.

In the furor surrounding last month's theft of a new iPhone prototype, Apple filed legal documents claiming that leaked details of the new model would be "immensely damaging" to the company because "people that would have otherwise purchased a currently existing Apple product would wait for the next item to be released."

-CNNMoney.com senior writer Parija Kavilanz contributed to this report To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 18,120.95 -42.04 -0.23%
Nasdaq 5,097.39 -9.20 -0.18%
S&P 500 2,120.96 -2.52 -0.12%
Treasuries 2.13 -0.00 -0.05%
Data as of 3:13pm ET
Company Price Change % Change
Broadcom Corp 55.94 -1.22 -2.13%
Bank of America Corp... 16.65 -0.09 -0.54%
Apple Inc 131.71 -0.33 -0.25%
Avago Technologies L... 141.15 -0.34 -0.24%
Boston Scientific Co... 18.36 0.37 2.06%
Data as of 2:57pm ET
Sponsors

Sections

GoPro offers system that can shoot virtual reality images using a six camera ball, and says it also plans to offer drone early next year. More

Renewables now account for 9.8% of U.S. energy use, the highest level since the 1930s, when people used a lot more wood. More

Lunchcruit is a new startup that facilitates lunch between employers and prospective employees in a relaxed, zero-commitment environment. More

Karlos Dansby, a linebacker with the Cleveland Browns, is bringing his winning strategy from the football field into the startup arena. More

If social security isn't enough steady income to carry you through retirement, an immediate annuity might be for you. More