Saturday, December 27, 2008

Wal-Mart iPhone Sales: Where's the Discount?

Wal-Mart is rolling out sales of the iPhone 3G this weekend -- but don't expect to see a lot of savings. As was speculated back in November, the discount retailer will begin carrying the iPhone on its shelves Sunday. Missing from the equation, though, is the discount.

It's no surprise, then, that the rush of reports claiming Wal-Mart would sell the iPhone for $99

created a bit of a stir and didn't seem entirely unbelievable. Turns out, of course, that instinct was wrong.

Selling Strategies

So what happened? It may just be that Apple doesn't believe its iPhone needs that strong of a push. The iPhone already commands almost a third of the U.S. smartphone market and is steadily growing, while Nokia -- the only company ahead of Apple in sales -- has been consistently losing share over the past months. In fact, analysts say Apple is "the only reason" the smartphone market stayed strong throughout the year's economic downfall.

A $99 iPhone would have boosted sales, no doubt, maybe even expanding the phone's demographical reach. But a $197 iPhone placed in front of millions of new faces will probably do the job decently, too. And, given the iPhone's ongoing success and ever-increasing appeal among young users, I suspect Apple isn't too worried about the outcome.

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