Wal-Mart starts selling discounted Android phones

The discounted G1 is available at 550 Wal-Mart outlets

Barely a week after T-Mobile began sales of the G1 Android phone, US retail giant Wal-Mart has begun undercutting the network operator on price.

Wal-Mart spokeswoman Melissa O'Brien confirmed to Dow Jones that as of today 550 stores will be selling the G1 for $148.88 for a two-year contract. This significantly undercuts T-Mobile’s price of $179.99.

The move is likely to cause some consternation among early adopters of the G1, as Apple found to its cost after it cut the iPhone price shortly after launch.

“Oh fantastic. I just ordered mine online LITERALLY 10 MINUTES AGO,” wrote a frustrated user on one G1 forum.

While it may anger some, the move will help the spread of the G1, since Wal-Mart is the biggest retailer in the US.