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RUMOR: Apple working on smaller, contract-free iPhone model

“Apple Inc. is working on new versions of the iPhone… according to people who have been briefed on the plans,” Peter Burrows and Greg Bensinger report for Bloomberg.

“One version would be cheaper and smaller than the most recent iPhone, said a person who has seen a prototype and asked not to be identified because the plans haven’t been made public,” Burrows and Bensinger report. “Apple also is developing technology that makes it easier to use the iPhone on multiple wireless networks, two people said.”

Burrows and Bensinger report, “Apple has considered selling the new iPhone for about $200, without obligating users to sign a two-year service contract, said the person who has seen it… While Apple has aimed to unveil the device near mid-year, the introduction may be delayed or scrapped, the person said. Few Apple employees know the details of the project, the person said… The prototype was about one-third smaller than the iPhone 4, said the person, who saw it last year.”

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