A video shows the new iPhone having a longer body and more scratch-resistant screen
I've owned every iteration of the iPhone since its launch in 2007, and with nearly every model, I'd eventually find little scratches and nicks everywhere on the phone except the display. Apple's decision to go with glass for a display was brilliant--plastic screens were lightweight, but they scratched easily and weren't as optically efficient as glass.
Given this accomplishment, especially when one considers the abuse the average cell phone goes through during a two-year period, Apple may be releasing the iPhone 5, or new iPhone, or whatever-you-wanna-call-it iPhone with even stronger glass. So, basically Apple is making its scratch-resistant glass even more scratch-resistant.
Looking at the video embedded below, along with leaked images, it seems the next iPhone may also be growing a bit, too. I do think that the current iPhone has the ideal display when it comes to usability. Try reaching for corners with one hand on a beast like the HTC One X or the Samsung Galaxy Note and you'll see exactly the kind of thumb calisthenics everyone complains about. The problem with the 3.5-inch iPhone display is watching videos and consuming other types of media on it--it was great for a while, but then those bigger phones showed us how much better it can be. A four-inch display may be a good compromise.
I've never been a fan of iPhone rumors since they've almost always turned out to be disappointingly wrong, with exception to predictions revolving around common sense, and the infamous Gizmodo iPhone 4 leak of 2010. But one thing these rumors do for me is, when they reach fever pitch, it's a reminder that announcements and launch dates are just around the corner. I expect the new iPhone to be different from the iPhone 4/4S design, along with tons of features that keep it mildly ahead of the smartphone pack. The event can't come soon enough!