The past few weeks there has been a bunch of crazy rumors flying around about a new smaller version of the iPhone 3G called the “iPhone Nano.” We have seen product sheets and third party cases suggesting that there will be another iPhone announced, but as the last iPhone rumors we heard they are probably false.

MacRumors has received an anonymous tip showing what is believed to be the iPhone Nano, but the source does lack a great deal of credibility. The picture lines up perfectly with the 3rd party case we recently saw. We really don’t believe that Apple will announce another form factor to the iPhone line.

We all know what happened to the rumors of a 4GB model coming to Walmart and we feel that even with multiple rumors will end up the same way. With the cheap model of the iPhone costing $199 ($149 refurbished) is there really a need to dig deeper and get an even cheaper version? Would such an iPhone be cost effective enough to manufacture? If this rumor turned out to be real we feel that this model would particularly appeal to women.

[Via SlashGear]