The general cycle of Apple rumors tends to be pretty predictable. One mainstream publication breaks a story, and over time, the other big publications follow with slight variations on the same rumor, roughly approximating the product that Apple will announce a few months later.

But the current back-and-forth over a rumored iPhone Nano is rare. You don’t often see the New York Times directly refuting Apple rumors that appear in the Wall Street Journal and Bloomberg. And you definitely don’t see the kind of confrontational undertone that the Times exuded in its scoop.

Yes, the Times’ Miguel Helft and Nick Bilton write, Apple wants to broaden the iPhone’s appeal with a cheaper model (and more voice commands), but no, there is no smaller iPhone. The article then proceeds to take down the iPhone Nano rumor piece-by-piece: A smaller device wouldn’t necessarily be cheaper to manufacture, says one source, and it would be harder to operate. It would also force developers to rewrite their apps, causing fragmentation that Apple definitely does not want.

The nail in the coffin is the Times’ last paragraph, which calls out the Wall Street Journal (but not by name) for outing the smaller iPhone’s code name as “N97.” Actually, the Times says, that was the code name designated for Verizon’s iPhone 4. Ouch.

I’m persuaded by the Times’ version of the story, but don’t know if there’s a big takeaway other than the fact that sometimes, Apple rumors are wrong (and I’m guessing most people know that already). Still, there’s one other nugget in the Times’ report that seems plausible: A cheaper iPhone would reportedly be a way for Apple to break into the prepaid phone market, particularly outside the United States where carrier subsidies and contracts are uncommon. I hadn’t thought of that when I said carrier subsidies are the key to Apple’s profits.

 
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