An on-going rumor indicates that Apple might be testing a bigger display for its forthcoming iPhone, however, the width should not change and only its length will be increase to offer a 640 x 1136 pixels resolution vs. 640 x 960 pixels today. So we could get a 3.95" display. I would offer a format very close to the 16:9 setting found in TV set, while we are currently having a 3:2 format. Developers would have to adapt their application to adapt to such change.
The rumor related to a smaller dock connector seems to be supported by many sources (but maybe with a single origin). It will create a huge earthquake among third-parties that have developed peripherals around the iPhone and iPod ecosystem. It is very likely that Apple will adopt such smaller connector for all its forthcoming iDevices.
