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According to You must login or register to view this content., they have acquired a prototype iPhone 4G.

They have taken a look at its software and internals, it is running iPhone OS 4.0 and all the internals are Apple's own, which reduces the doubt that it is a fake.

It was reportedly found in a bar in San Jose, California. The engineer had a little too much to drink and left it there.

It has a multitude of new features, including:

• Front facing video chat camera.
  
• Improved resolution standard camera.
  
• The camera now has a flash.
  
• Micro-sim technology instead of standard SIM, similar to the iPad.
  
• Higher resolution display, thought to be 960x640.
  
• Split volume buttons, one is expected to double as a camera button to satisfy iPhone user feedback.
  
• All buttons are metallic, not plastic.
  

However, they are a large amount of differences compared to the 2G, 3G and 3GS, all of which fit with some of Apple's recently filed patents.

These changes include:

• The back is now made of glass, or some ceramic material instead of plastic, this allows for better signal.
  
• 3 grams heavier than the 3GS.
  
• Slightly smaller screen.
  
• Battery is 16% larger, hopefully giving the phone some longer life.
  

Gizmodo reported this a few days back and were unsure of its authenticity, however, may pieces of an authenticity puzzle have now fit together into a solid picture.

Apple sent a formal request to You must login or register to view this content., asking for the iPhone Prototype back, which qualms any doubts that is IS theirs and they didn't want it to be seen by the public. When it was found it was disguised as a 3GS by an elaborate case.

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I for one prefer this more industrial looking iPhone, it suits the Apple tradition more than the curve-backed iPhones of the past.

If any more information surfaces I will update this thread.