DALLAS – Wal-Mart Stores Inc. confirmed Friday that it will begin to sell the iPhone 3G on Sunday.

About 2,500 of its stores will carry a black 8GB model for $197 and a 16GB iPhone in black and white for $297, with a new two-year service agreement from AT&T or qualified upgrade, Wal-Mart said Friday.

The smart phone’s prices have been falling ever since it hit the market, but Wal-Mart’s $2 discount on a $200 and $300 purchase isn’t likely to get shoppers too excited. However, Wal-Mart stores, with their 130 million customers a week, have the potential to introduce more people to iPhones than Apple’s own stores.

If anyone does lower prices, Wal-Mart said the phones are covered by its price match policy: Stores match the price of any local competitor’s advertised store price on the same item within the same promotional period.

Store associates “have been preparing for many weeks” for the arrival of iPhone 3G, and are ready to assist customers with purchase questions, demonstrations and activation, said Gary Severson, senior vice president entertainment at Wal-Mart.

Wal-Mart is setting up Apple iPhone 3G kiosks in its consumer electronics department. The world’s largest retailer has been gaining market share in the past couple of years in the electronics category by steadily adding desired brands including Dell computers and Sony TVs.

Best Buy Co. has only been carrying the iPhone 3G since September in its free-standing Best Buy Mobile stores and expanded mobile shops inside its stores. It launched the phones at $199 for the 8GB model and $299 for the 16GB model. It also requires a new two-year contract with provider AT&T for qualifying customers.

Apple first introduced the phones at whopping $599 but the price has been dropping and the last decline came when it hooked up with AT&T providing wireless service.