8GB iPhone 4S version to be introduced at iPhone 5 launch?

A new version of the iPhone 4S with a smaller storage capacity will be introduced next week according to unnamed sources close to the matter.

They also suggested that the new phone will be available from as little as £20 per month. This follows the trend introduced by Apple last year with a thee-tier offering.

The iPhone 4S currently costs £499 with the iPhone 4 available from £429 and the iPhone 3GS from £319 with contract prices starting from £31, £26 and £20 respectively depending on mobile phone operators.

The fact that Apple managed to sell a 3-year old device for more than three times the price of comparable devices (like the Windows Phone-based Nokia Lumia 710) is a testament to the power of Apple’s branding.

The follow up to the iPhone 4S will debut on 12 September and is said to go on sale from the 21st. The iPhone 5 could be Apple’s biggest handset launch yet as the company tries to fend off growing competition from Android handsets.

Up to 10 million iPhone 5 units could be sold by the end of September according to one analyst, which would bring in at least $5 billion in revenues.

The new iPhone is widely tipped to have a larger 4in display with 4G LTE connectivity and a new system-on-chip, the same as the new iPad.