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Chipmaker leak points to iPhone Nano in June

But you may not see it unless you're Chinese

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Rumors that Apple has a scaled-down iPhone dubbed the "iPhone Nano" in the works have lurched forward following a report here that two Taiwanese companies are set to supply chips for the phone.

According to DigiTimes, the two purported chip suppliers are the Taiwan Semiconductor Manufacturing Company (TSMC) and United Microelectronics Corporation (UMC).

Both are major industry players - TSMC had 2008 sales of just under $10bn (£6.9bn) and UMC just under $2.8bn (£1.9bn). If, indeed, they are to become among Apple's suppliers for the iPhone Nano, part shortages should not be among Cupertino's challenges.

DigiTimes also reported that "the launch of Apple's iPhone Nano is expected to take place in June this year at the earliest."

Rumors of the iPhone Nano first surfaced last December when word leaked out that Shenzhen, China, case maker XSKN had developed a protective case for it - a case, by the way, that the company still offers for sale on its site, Nano or no Nano. The company also hosts a website that tracks iPhone Nano rumors.

One interesting twist on the on-again, off-again rumor cycle appeared yesterday when the International Business Times reported that analyst Brian Marshal of AmTech (formerly American Technology Research) was of the opinion that plans for the iPhone 3G's little brother were still on track, but that the device wasn't intended for US sales.

Among the reasons that Marshal cited was that "insiders have confirmed that the iPhone nano is not yet in the testing labs at AT&T" - and if AT&T isn't testing it, there's a good chance that it won't be distributed by a US carrier.

The Times also quoted Marshal as saying: "Obviously, the best-case scenario here would be a China launch (~600mil+ wireless subscribers total in the country), but we have no definitive knowledge of this and are working on identifying the locale of launch and other pertinent details."

If this speculation were to come true, one problem posed by the pint-sized phone - its small display - would be mildly mitigated. As shown in XSKN mockups, the iPhone Nano's display is approximately the same width as the iPhone 3G, but significantly shorter.

A smaller screen would not well accomodate a majority of the 10,000-or-so applications in the iTunes App Store. Most of those apps, however, are designed for an English-language audience. If a smaller-screened iPhone Nano were limited to the Chinese market - if a market of over 1.3 billion people can be called "limited" - an entirely new development cycle of Chinese-specific applications could begin.

If an iPhone Nano is coming to China, a smaller display would also enable it to be less expensive than its western counterpart. And there's also a good chance - and this is completely speculative - that a Chinese iPhone nano would not be GPS-equipped, considering that government's attitude toward information control.

These cost savings could make the iPhone Nano a low-price, must-have gadget.

If it exists. ®

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