The iPhone 4G -- as it is currently being called -- would sport an OLED display, a dual-core processor and a better graphics chip. Other features being reported include a removable battery (!!!), dual cameras to support video calling, and possibly mobile TV services.
How likely is all this to be true? Well, I have to believe that a serious upgrade to the iPhone's display is in order. The 320 x 480 display is looking decidedly shoddy when compared to the 480 x 800 displays of today's Android devices. Whether or not its is OLED, I can't say, but that's what would make sense given OLED's improved battery life capabilities.
Speaking of battery life... Despite the long-standing complaints against the iPhone's non-replaceable battery, I have a hard time believing that Apple would suddenly change course. Apple has been integrating batteries into its products for years, and has even begun to do the same with its laptops. As much as iPhone users might want a user replaceable battery, it's unlikely.
I fully expect the next iPhone to have dual cameras: a five-megapixel main shooter and a VGA user-facing camera for video calling.
The current iPhone 3GS has a 612MHz processor. Despite coming in way below Qualcomm's 1GHz SnapDragon chips with respect to clock speed, it remains to be an extremely efficient processor. Are dual cores the answer for Apple? Perhaps. The improved GPU will certainly go a long way to improve 3D gaming if the rumor is true.
For now, we simply have to wait for Apple to get around to announcing iPhone version 4.0.