J.P. Morgan, the source of the rumor that a low-end iPhone based on Apple's iPod Nano is being developed, today issued a research note distancing itself from that claim.

If you didn't see that denial coming, you were probably too busy admiring your reflection in your iPhone's lustrous screen.The analyst behind the iPhone Nano rumor, Kevin Chang, apparently based his report on an Apple patent application and his own interaction with the manufacturing companies in Asia.

Apple patent applications are, in general, terrible sources for product specifics. They'll give you a sense of the technology Apple is developing, but the final manifestation of that technology is very hard to predict because Apple's lawyers word the company's patents to cover phones, computers, and all manner of electronic devices.

But, really, the whole idea of an iPhone Nano runs smack into the ugly reality of usability. Apple's iPhone is about as small as you'd want a phone to be. Thumb typing on a Nano-sized screen would just be awkward and the device's small size would reduce its value as a media viewer.

I suspect Apple will eventually release a low-end iPhone, perhaps in 2008. It may even be a bit smaller than the iPhone's current form factor. I just hope Apple makes it large enough that it's not a choking hazard.