Apple disappointed a lot of people when it didn't announce an iPhone 5 last month. Though owners of the new iPhone 4S are no doubt happy with their purchase, the world thought Apple was gearing up to launch a completely redesigned iPhone and the minor upgrade that was launched in its place was a huge disappointment. However, it seems an iPhone 5 was on the cards for this year, until just a few months prior the launch.
Business Insider cites a reliable industry source that's been right about Apple stuff in the past in reporting that the fully redesigned iPhone was real but was scrapped by Steve Jobs because he didn't like it. BI's source says that Apple engineers he knows thought a new, full redesigned iPhone was going to be Apple's next big announcement until about three months before the iPhone 4S was announced (so Julyish). BI's source says he spent two weeks with one of the new, redesigned phones (before the project was scrapped, we assume) and that the device had a large 4-inch display; was made of in-house prototype material (ie. not production quality); had an aluminum back, just like the rumors predicted; a messed up color profile on the screen (an attempt, he believes, to draw attention away from the fact that Apple planned on having a better screen on the iPhone 5); no physical home button; a flatter/thinner design; much improved performance; a woeful battery; a 10-megapixel lens; and a version of Siri, then called Assistant.
All in all, that sounds to us like a pretty impressive piece of equipment. So why did Steve Jobs toss this device in favor of the iPhone 4S? According to BI's source, there's a rumor among Apple staff that says Jobs wasn't happy with the size of the screen because it "fragmented" the iPhone line. Steve has expressed his distaste for massive screens in the past, so we're not surprised to hear that a 4-inch display didn't jive with him. Still, with phones getting bigger and bigger, we're starting to think customers will want a 4-inch iPhone soon. The iPhone 4S's 3.5-inch display is going to look quite small next to the Galaxy Nexus' 4.65-inch panel.