Best Buy Co., Inc., the largest specialty retailer of consumer electronics in North America, will begin to sell  iPhone 3G in its stores starting Sunday, thus becoming the first retail chain in the United States to vend Apple’s hot handset aside from Apple itself and AT&T Inc.'s stores.

The iPhone 3G’s will be available for $199 for the 8GB model and $299 for the 16GB model (the same price as in AT&T and Apple stores). It’s worth reminding those who are interested in Apple’s high-end handset that purchasing the gadget includes the signing of a new two-year contract with AT& T.

The Minneapolis-based retail chain also sells Apple’s iPod media players and the Macintosh line of personal computers in its 970 full-size stores and 16 small Best Buy Mobile stores.

The highly-popular iPhone 3G went on sale in July. Sales were good, but users of the handset experienced errors as the phone automatically and quite inexplicably switched from the 3G network to other slower networks. The hiccup caused on-going phone calls to switch off quite often. The Cupertino, California-based software developer came up with a patch to fix the errors.

Best Buy shares closed Friday at $44.92. Last summer, the behemoth retailer announced its plans to expand its operations with about 40%. The change will boost Bet Buy’s number of stores to 1,800 worldwide of which 1,400 would be in the U.S.