When it comes to Wal-Mart, I do not shop there because of many reasons. However, it is based on what I believe and due to the success of the company, lower prices, no matter the cost, takes priority in the majority's eyes. I am waiting on a 32gb iPhone and if Apple comes out with one and Wal-Mart sells it cheaper there than anywhere else, I would not buy it there.
However, this is a business move on Apple's part and I can only view it as smart move, if true. The consumers make Wal-Mart the success that it is and Apple may use that to grow as a business. For what I want an iPhone for, 4 gb is way too small, and so is 16 gb that's out now. But I can see Apple doing re-releasing a 4gb model because I'm sure it will sell *enough.*
I work for a company that unfortunately pays their employees almost as crappy as Wal-Mart does and I see many mp3 players around which are not iPods or Zunes. Just about all the employees have cell phones and for $99 they may be able to get an iPhone that can also hold their music.
Plus if the move is unsuccessful, I would think Apple would do research to find out why. If it is the storage, a year later the 8 gb phone may become the $99 model. If it is the cost of the contract or just lack of interest within the Wal-Mart stores, they may rework the pricing plans or just cease selling there. It's not like Apple hasn't reversed decisions or made bad ones. The short fat iPod Nanos didn't last long before they went back to the long skinny ones.
Maybe these 4 gb models will also show up at Costcos as well. I don't really care whether these rumors are true or not, but I do believe more competition in any industry is a good thing. Just my cents....