Apple is expected to unveil the next iPhone at its annual mobile keynote this year and as is the case with any high profile product launch, rumors about the device are beginning to materialize months before the event is scheduled to take place. Most recently, Wall Street Journal sources suggest that Apple intends to upsize the iPhone’s display from 3.5 to 4 inches.

The information comes from sources "familiar with the matter" who appear to have connections at screen manufacturers Sharp and LG. While this is far from official information, if true, it could mean that Apple is finally feeling the pressure from competitors like Samsung, whose 4.8-inch Galaxy SIII is one the most anticipated devices of the year.

If this information holds true, what does it mean for Apple? The iPhone has essentially defined the smartphone since its unveiling in 2007, leaving all other competitors to play catch-up. If Apple changes the iPhone’s screen size after five generations, does this mean that it is is responding to the fierce competition it faces from Android? According to MobiThinking, at the close of 2011 Android was powering 48 percent of the world’s smartphones, compared to Apple’s 19 percent. If Apple does decide to bump up the screen real estate with the next iPhone, it wouldn’t be the first time it has been influenced by its competitors. With iOS 5, Apple added the notification center, which bears a striking resemblance to Android’s pull-down notification bar.

Apple faces stiff competition from Samsung, whose phones feature much larger screens (Photo: Samsung)

Many of the iPhone's competitors have already moved past 4 inches - the Galaxy Nexus, and the Nokia Lumia 900 both have screen sizes above 4 inches and have been well received by consumers and critics alike. Furthermore, devices like the Galaxy SIII have began to catch up with Apple’s brilliant retina display, offering a similar pixel density in a device that measures 4.8 inches diagonally.

With the track record of the voracious Apple rumor mill being somewhat hit and miss, only time will tell on this one.

Source: Wall Street Journal, MobiThinking