With Apple’s World Wide Developers Conference scheduled for the week of June 7, there are already plenty of rumors and speculation about what the company will announce.

Adding significant fuel to that fire is Wal-Mart’s Monday announcement that it is lowering the cost of 16GB iPhone 3GS models to $97, more than half the original $197 cost. These kinds of price cuts normally indicate a desire to clear inventory. The question now is: For what?

Steve Jobs will give the opening keynote at WWDC June 7, and Apple usually only trots out the master pitchman when a new product is in store. So expectations that a new iPhone model will be announced is at an all time high.

Wal-Mart says the pricing move is just part of it’s normal “aggressive” pricing strategy, and there’s no indication that it has any advance knowledge of Apple’s plans than anyone else (the same model phone remains at full price from AT&T and Apple).

Other rumors floating around include that Apple will announce plans to discontinue the 8GB iPhone 3G, and of course the possibility it could introduce its cloud-based music plans.