Walmart discounts new iPhone 5c by 20%

The 16GB model will be $79 with a two-year contract; pre-orders start Friday

Walmart today confirmed that it will take in-store pre-orders for Apple's new iPhone 5c Friday morning, and will discount the smartphone to $79 with a two-year carrier contract.

Apple introduced the iPhone 5c -- essentially a repackaged iPhone 5 but inside a polycarbonate chassis that comes in five colors -- on Tuesday, along with the new flagship iPhone 5s. It was the first time in Apple's smartphone history that it launched a two-tier device strategy.

Apple's list price for the 16GB iPhone 5c is $99 with a two-year mobile contract, and $199 for the 32GB model. Sans a contract, the smartphone sells for $549 and $649 for the 16GB and 32GB configurations, respectively.

"The fulfillment of pre-orders will be processed on a first come, first serve basis ... subject to manufacturer availability and carrier launch dates," a Walmart spokesman said in an email.

The big-box retailer will also discount the iPhone 5s, with the 16GB device selling for $189, $10 off list, starting Sept. 20.

Apple will not take pre-orders of the flagship iPhone 5s this cycle, a departure from past practice. Analysts have speculated that either there are supply constraints with the 5s -- due, perhaps, to one of its new components, like the fingerprint scanner -- or Apple is purposefully promoting the 5c over the 5s.

Other pundits have pushed the theory that Apple, wanting to boost foot traffic in its own retail stores, abandoned pre-orders for the iPhone 5s to drive customers into the outlets to expose them to other hardware, including the iPad and Mac notebooks.

Walmart's discounts followed an announcement Wednesday that the retail giant will enter the smartphone buyback market -- dubbed "re-commerce" by many in the business -- and will accept trade-ins of older handsets.

In a release Tuesday touting its new trade-in program, Walmart said it would offer $300 credit toward a new phone for a working-condition iPhone 5. That's slightly less than the $310 that re-commerce player Gazelle pays -- in cash -- for an iPhone 5.

Apple has taken a beating on Wall Street for the iPhone 5c's pricing. Wednesday, investors drove down Apple shares by 5.4%, although as of 12:45 p.m. ET Thursday, prices had climbed 1.6% since the opening bell. Other analysts, however, have pointed out that Apple's refusal to go lower and directly compete on price is consistent with its decades-old strategy of positioning its devices as premium, luxury products.

U.S. carriers Sprint and Verizon have said on their websites that they will begin taking online pre-orders for the iPhone 5c starting at 12:01 a.m. PT Friday. Presumably, Apple will open its own online store for 5c pre-orders at the same time.

Sprint iPhone pre-orders
Sprint will start taking online pre-orders for the iPhone 5c at 2:00 a.m. Central Time Friday, or 3 a.m. ET and midnight PT.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, on Google+ or subscribe to Gregg's RSS feed . His email address is gkeizer@computerworld.com.

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