Photos and video of a 64GB iPhone 4 that was said to have been smuggled out of Foxconn are making the rounds on the Internet. The photos and video confirm that Apple has apparently toyed with a 64GB version of the iPhone as has been rumored for some time.

Before the last iPhone was introduced, it was widely rumored that Apple was poised to release a 64GB version to satisfy customer demand, but the company elected not to release the 64GB version and instead continued with the 16GB and 32GB versions as their primary offerings.

It is unknown why Apple has chosen not to release a 64GB version of the iPhone, but some suggest that it simply was trying to keep the price down and not offer larger versions too quickly. Some analysts that we spoke with suggest that Apple is trying to wait to offer a 64GB version, as it wants to capture as many upgraders as possible since many current iPhone owners will want to upgrade to the 64GB model to take advantage of the increased storage.

While it is not known if Apple will release a 64GB model this time around, our sources tell us that it is likely if the price of flash memory stays where it is or goes down even farther. It is believed that many iPhone users have requested an iPhone with larger memory, but so far Apple has not responded. The evidence of a 64GB engineering prototype does suggest that the company is at least thinking about it.

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