Four-inch iPhone 5 with NFC chip goes in full production in Q3, says Chinese paper

Image credit: Fast Company

China Times is abuzz (original in Chinese, Google translation) with alleged details concerning a fifth-generation iPhone 5. The handset is in trial production as we speak, the story claims, and full production is expected in the third quarter of this year. This would indicate that iPhone 5, which is expected to be introduced this summer, may not be immediately available in larger quantities following the launch. The device will be manufactured by Apple’s long-time manufacturing partner Hon Hai Presicion Industry Co., also known as Foxconn, the paper added. We told you this past weekend that Foxconn is planning to open a new manufacturing plant in São Paulo, Brazil in order to meet Apple’s growing appetite.

China Times also confirms speculation that iPhone 5 boasts a larger four-inch touchscreen in response to Android superphones with blown up displays. The story goes on to mention a possible NFC chip for contactless payments and an all-new scratch-resistant metal chassis designed to improve reception. The metal back corroborates our Foxconn source telling 9to5Mac that iPhone 5 will sport metal back akin to the original iPhone.

Plus, leaked parts we obtained yesterday from our Foxconn connections indicate that iPhone 5 will look a lot like iPhone 4, sans a larger display. The phone should be available in both black and white, parts analysis suggests. The existence of the home button on the leaked part contradicting claims of iPhone 5 losing the physical button to instead rely on brand new new gestures. The NFC chip was mentioned numerous times by the blogosphere, gaining steam lately as big media puts their credibility on the line, including Forbes and The New York Times. The latter paper describes a possible Apple-branded payment system that could use iTunes accounts for swipe payments:

According to two people with knowledge of the inner workings of a coming iteration of the Apple iPhone – although not necessarily the next one – a chip made by Qualcomm for the phone’s processor will also include near-field communication technology, known as N.F.C. This technology enables short-range wireless communications between the phone and an N.F.C reader, and can be used to make mobile payments. It is unclear which version of an iPhone this technology would be built into.

I also speculated that a powerful combination of Apple’s brand and marketing muscle and the iTunes billing system is needed in order to take wireless payments into mainstream, outside the tech-inclined crowd. The Independent begged to differ, saying NFC technology will debut with iPhone 6 next year. In addition to contactless payments, Cult of Mac speculated, the chip, together with Apple’s cloud application store and MobileMe service, will enable a portable login system for Macs.