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Walmart Slashes Price on iPhone 5, iPhone 4S

Walmart is aggressively lowering the price on Apple's iPhone 5 and iPhone 4S. Beginning Saturday, the iPhone 5 will sell for $129 (down from $189) and the iPhone 4S will sell for just $39 (down from $89). To get the devices at that price will require signing a new two-year contract with Verizon, AT&T or Sprint.

This isn't the first time Walmart has offered drastically lower prices for Apple devices. In December, the company offered the iPhone 5 for $127 and the iPhone 4S for $47 as part of a holiday promotion.

We asked Walmart if the new pricing is temporary and were told that no, this is in fact the permanent price of the items. The new price is only available in Walmart stores and is not available online.

The price drop is also notable because Apple has historically limited the degree to which retailers can drop prices on its products. Although some retailers such as Walmart routinely discount items by $10, cutting the price by more than 30% (in the case of the iPhone 5) and nearly 70% (in the case of the iPhone 4S) is unprecedented.

We contacted Apple for comment on the price drop but haven't heard back as of press time.

Puts Pressure on Competitors
It will be interesting to see if other retailers drop the prices of the iPhone 5 and iPhone 4S to compete with Walmart. We're also curious about how stores that traditionally price match will handle the new price. In January, Best Buy said it lost $65,000 in one day because of price-matching Walmart's sale price on the iPhone 5.

Since then, the company has run its own sales on the iPhone 5, but none as drastic as the $129 price point Walmart is now targeting.

Why Is the Price Lower?
Its unclear why Walmart is lowering the price so aggressively on the iPhone 5 and iPhone 4S. It's possible the company has excess inventory it wants to clear out before the rumored iPhone 5S comes out this fall, or the company could just want to kickstart more sales.

Walmart Slashes Price on iPhone 5, iPhone 4S
In a Google+ Hangout Friday, Mashable Editor-in-Chief Lance Ulanoff remarked that as long as Apple doesn't have a new product available for purchase, Samsung is in the perfect position to "eat its lunch" all summer with the various versions of the Galaxy S4.

Perhaps a lower price will pull in customers who may otherwise be swayed by Samsung's increasing prowess in the smartphone market.

A price drop also puts pressure on the smaller iPhone competitors such as the Nokia Lumia 920, 925 and 928 and the BlackBerry Z10 and Q10. After all, if the iPhone 5 is less or nearly the same price as those other phones, price-conscious buyers may be less likely to consider something else.

Good News for iPhone 4S Buyers
Although I fully expect an 8GB version of the iPhone 4S to be available for free this fall (with the iPhone 5 taking the $99 spot), the opportunity for buyers to get that phone for $39 now is a great deal. The iPhone 4S is still a terrific phone and certainly better than any other smartphone in the sub-$50 with contract price area.

For users looking to add a good, but not cutting-edge smartphone to their family plan, this is a great opportunity.

What do you think of Walmart's price cuts to the iPhone 5 and iPhone 4S? Does it change your purchasing plans? Let us know in the comments.

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