With Walmart's former digital video head now working as Apple's head of international movies and TV, the companies enjoy a rather friendly relationship.  This relationship and supposed leaks fueled speculation that the pair was going to launch a $99 USD 4GB iPhone for sale at Wal-Mart stores.

Now it appears that rumors of the iPhone coming to Wal-Mart have been confirmed -- whether intentionally or unintentionally.

Walmart shoppers this month began to notice something strange.  Some Walmart store owners have already put up the decals and cardboard standups for a new ad campaign advertising the iPhone at Apple.  The ads state simply, "iPhone 3G: Now at Walmart".

According to prior reports the handsets will go on sale at 9:00 A.M. on Sunday, December 28th. 

While the appearance of advertising materials has as much as confirmed the fact that the phones are coming, it does little to establish if the rumors of the $99 USD limited edition Walmart-exclusive 4 GB iPhone are true.  If they are, it would mark the cheapest price for the iPhone yet.  However, AppleInsider, which broke much of the story, is now saying that it believes these rumors to be false.

It says that instead Apple will sell the 8GB and 16GB 3G models, for $197 USD and $297 USD respectively.  According to reports 488 Walmart stores were selected as pilot stores for the program to test that all the systems were working before a full deployment.  It's unclear whether the stores putting up the advertising information were the pilot stores, but this would seem a logical conclusion.

Each Walmart store, according to reports, must sell five iPhones to its employees.  The iPhones will be sold at full price.  However, the employees will receive a 15 percent discount off their AT&T monthly bill.