iPhone 3GS

Another day, another iPhone rumor... BGR is sticking to their earlier report that a new iPhone will be released this August, but this time their unnamed source also revealed that Apple plans to offer a cheaper prepaid iPhone and their next generation device by the end of this summer.

According to Boy Genius Report, Apple will begin selling the iPhone 3GS for around $350 with no contract. Their "incredibly solid source" could not confirm the iPhone 5 with teardrop design that they announced back in June, but they did confirm that the next generation iPhone will be announced by "late August-ish."

Every possible future iPhone scenario has already been theorized this year, but what about a new iPhone carrier? Starting tomorrow Sprint will be one of the last U.S. carriers to offer unlimited data plans, and with the rise of the Android Market, the days of Apple exclusivity looks to be coming to an end.

Analyst Shing Yin of Citadel Securities believes we will see an iPhone added to Sprint's arsenal by the 2011 holiday season. Out of all the analyst predictions and rumors this one seems quite plausible, however, there are no known talks between Apple and Sprint about an upcoming deal.

When asked about a possible future Apple/Sprint team-up, Sprint CEO Dan Hesse said, “What is this — like the 55th time I’ve been asked that one? Something like that. And of course, we can’t comment on any potential discussions with any of our suppliers.”

I don't know why I started following all these analyst reports, but since I did here's the latest:

Monday: Deutsche Bank analyst Chris Whitmore predicts Apple will announce an unlocked mid-range ($300 to $500) iPhone to penetrate the pre-paid mobile market share.

Tuesday: BMO Capital analyst Keith Bachman believes Whitmore is wrong because Apple will never release a low-end phone. Instead, Bachman thinks Apple will discount the iPhone 3GS to attract people on a budget.

Today, analyst Mike Abramsky with RBC Capital Markets said Apple will break tradition and not discontinue the iPhone 3GS when the iPhone 5 is announced. Abramsky said Apple is “expected” to offer the iPhone 3GS for free to attract mid-market buyers and slow the growth of the Android market.

On Monday, Deutsche Bank analyst Chris Whitmore told his clients to expect Apple to release two iPhones, one of which would be an affordable device to help Apple grab a part of the pre-paid mobile market share. But BMO Capital analyst Keith Bachman says Apple is all about making exciting high-end devices, and he doesn't see them releasing a low-end phone this year. Bachman believes that AT&T's re-marketed iPhone 3GS will be the phone Apple uses to hook budget-conscious consumers.

Thinking you can keep your iPhone 3GS and take advantage of all the new features and improvements that iOS 5 will offer this fall? Think again. Apple is rumored to be leaving the 3GS hardware behind when it updates its mobile operating system to the latest and greatest version. Already the previous discontinued model iPhone 3G is stuck at iOS 4.2.1 and can't take advantage of many iOS 4 features.

The move could signal major changes in iOS 5 that will require improved hardware such as that found inside the iPhone 4. Apple is expected to focus on the next version of iOS and mobile software development at the annual WWDC coming in the first week of June. The fifth generation mobile operating system is expected to support new cloud-based features including streaming media and storage solutions provided by Apple.