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IPhone debuts at Best Buy

Best Buy Co recently entered an agreement with Apple Inc to sell the new 3G iPhone. The retail chain has 970 stores nationwide.

Analysts say the agreement will boost Best Buy’s market share. The mobile handset could produce 2 percent profits in the second half for the retail chain. Over one million Apple iPhones could be sold at Best Buy this year alone.

“We think this underscores Best Buy’s strong working relationship with Apple and provides even greater differentiation from peers,” Standard & Poor’s Equity analyst Michael Souers said in a research note.

Souers also said the iPhone will help grow traffic and sales in this year’s holiday season, which could be weak overall on slower consumer spending.

The new 3G iPhone will be one of the hottest gadgets this holiday season. The cell phone lets users connect to the Internet at higher speeds. Best Buy will sell the new mobile phone for $199 to $299 and will require a two-year contract with carrier AT&T Inc.

Early shares for Best Buy were up 9 cents to 45.00 in early New York Stock Exchange trading.

Apple plans to further expand its cell phone market. The deal with Best Buy is the first step on reaching out to more retail chains. Best Buy will start selling the Apple iPhone on September 7.