Best Buy's win as the first independent U.S. chain to sell the iPhone at 600 of its locations could set the retailer up to be one of the big winners during the holiday season. Competition is normally fierce among "must have" gadgets, but with the economy slowing, there just aren't as many rivals for Apple's popular phone. Best Buy will sell them for the same starting price of $199 for the 8GB model, with the same 2-year service agreement with AT&T.
Best Buy (BBY) shares jumped about 3 percent in early trading. Apple (AAPL) gained about 2 percent.
The announcement is also Best Buy's best bet to beat back ongoing weakness among consumers. July retail sales fell for the first time in five months, held back by poor auto sales. Analysts say the effects of rebate checks are mostly over.
News from the rest of the retail sector looked worse. Macy's (M) posted lackluster second-quarter earnings, and cut its earnings estimates for the rest of the year after announcing that fall sales would be flat to down slightly. The company's shares fell about 3 percent.
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Ginger Bumgardner of CA 11:54AM August 13, 2008
Ginger Bumgardner of CA 11:54AM August 13, 2008