It all started on Valentine’s Day. Yukari Iwatani Kane and Ethan Smith at The Wall Street Journal reported a Smaller iPhone sighting:

One of the peo­ple, who saw a pro­to­type of the phone late last year, said it is intended for sale along­side Apple’s exist­ing line. The new device would be about half the size of the iPhone 4, which is the cur­rent model.

Then Miguel Helft and Nick Bilton at The New York Times weighed in:

But con­trary to pub­lished reports, Apple is not cur­rently devel­op­ing a smaller iPhone, accord­ing to peo­ple briefed on Apple’s plans who requested anonymity because the plans are confidential.

But then here’s some­thing that got my head scratching:

More impor­tant, a phone with a smaller screen would force many devel­op­ers to rewrite their apps, which Apple wants to avoid, the per­son said.

And John Gruber at Daring Fireball agrees with the NYT:

Anyway, a smaller iPhone would be stu­pid, if by “smaller” you mean a screen that mea­sures less than 3.5 or so inches. The phys­i­cal size of the UI mat­ters more than any­thing else.

Picture this: a kid in ele­men­tary school wield­ing an iPhone 4. Kinda big if you ask me. If Apple is build­ing a smaller iPhone, it would be for guys and gals with smaller hands. The phys­i­cal size mat­ters, which is exactly the rea­son Apple would build a smaller iPhone. A smaller screen would force app rewrites? No. What if the smaller iPhone had a pixel for­mat of 480×320? The same as the iPhone 3GS, 3G and the orig­i­nal? No rewrit­ing required at all. And guess what? Apple would clas­sify it as a Retina Display. Pure genius.

But is Apple really work­ing on a smaller iPhone? Who knows.