In a not so surprising move from Wal-Mart, they’ve dropped the 16GB iPhone 3GS to $97. There are two possible reasons for this:
1. Wal-Mart wants to increase sales of the 3GS iPhone to make way for the soon to be released iPhone 4
2. The 3GS will replace the 8gb 3G as the entry-level iPhone sometime next year.
Jobs has already stated that the new iPhone 4.0 software will only work on 3GS and the iPad. This sounds like the Apple way to get people to ditch their current iPhones (even if they still work) and buy the newer version which, we are hoping, will be released at WWDC in a few weeks.