Digitimes is reporting Apple is currently developing two phones for release in 2013, with a third phone already being tested for a tentative 2014 release. The first two phones are expected to be the iPhone 5S that will only change the internal specs without much cosmetic change. The devices are rumored to feature 4-inch screens and in-cell technology.
One of the phones planned for this year is once rumored to be the cheap iPhone 5S that will target emerging markets like China. Previous rumors said it would have a larger screen and feature a cheaper chassis. The rumor today suggests that the cheaper iPhone will be more similar to the regular iPhone in cosmetics, but perhaps feature lower specs. The reduction in price can also be attributed to better yields for the in-cell technology used in the iPhone 5.
So what about that third iPhone in production for 2014? Digitimes' sources say that Apple is playing around with the idea of a 4.8-inch screen. If true, it would be the largest phone that Apple has made to date. Samsung and others are already producing smartphones with screens of that size and larger, but those phones are also comparably fat. I wouldn't be surprised if Apple is waiting for a reduction in component size so it can release a larger phone without sacrificing the trademark thinness of the iPhone brand.
As always, these are all rumors at this point, but Apple has to shake up it's iPhone brand at some point. The company has been playing it safe for far too long. If the company doesn't introduce something radically different this year then 2014's rumored larger phone may just be when Apple really starts to take risks.