ITWire

While some will turn up their noses at the idea of an iPhone with just 4G of storage, it's not impossibly small. After all, the original iPhone came in a 4G version, and there are millions of iPods out there (including mine!) with similar amounts of storage.

But for those that want to carry around a bunch of movies or who plan to max out on applications, there's always the possibility of upselling (upbuying?) to an 8 or 16G model.

After all, there's nothing in Boy Genius's report that says Wal-Mart will only be selling a 4G model.

The big question is whether people who would be tempted by a $US100 reduction in the minimum price of an iPhone will be prepared to pay anything from $US69.99 to $US129.99 in monthly service fees - especially when text messaging is an extra-cost option.

Unless AT&T is planning to offer new and cheaper plans with limited data use to accompany the cut-priced handset.

Where AT&T currently provides unlimited email and web traffic ('phone as a modem' or tethered use is prohibited) carriers in many other markets price their data plans according the amount of data required.

We'll find out whether Boy Genius's source was right after the holidays - the site has tipped December 28 for the iPhone's Wal-Mart debut - and if so, whether AT&T has come up with any new plans to cater for the lower end of the market.