Boy Genius Report is claiming that two separate sources have told them that AT&T is looking to sell an 8GB iPhone 3GS for $99 US before Christmas. While this news wouldn't come as a shock, it would certainly take more than AT&T to make it happen. As most of you know, Apple doesn't make an 8GB iPhone 3GS and it would probably mean the discontinuation of the iPhone 3G in general.

If you think back to the time of the first generation iPhone (it was so long ago now), you'll probably remember that Apple quickly discontinued the 4GB iPhone after realizing that most people were opting for the larger capacity. Not too long after that, Apple introduced the 16GB version and discounted the price of the 8GB. Now that the iPhones themselves are subsidized by the wireless carrier, the game is a little different.

I doubt that we'll see AT&T discount the 16GB iPhone 3GS to $99 US, even though it would be a huge strategic move before the holiday season, but I have a hard time believing that Apple would be willing to manufacture an 8GB iPhone 3GS. It's one thing for them to continue with the 8GB iPhone 3G because they already have the manufacturing in place, but for Apple to start manufacturing another iPhone 3GS at a capacity less than its current models -- that just seems out of place.

I've found it disappointing that the iPhone (a professional device) has had a smaller capacity than that of its sister, the iPod touch. Currently, the iPod touch is shipping at a top capacity of 64GB and the iPhone only 32GB. Here's the point: if AT&T and Apple could work together and release the 16GB iPhone 3GS at $99 then that could potentially allow for the 32GB at $199 and a 64GB model at $299. That would be a killer plan for the two companies just before the holiday season.

While this may be far-fetched, I don't think it's impossible: Apple did release a bump in storage to the 16GB iPhone in early 2008 without any warning. Here's hoping that they do that again.

The rumors were true on this one, too -- there's a new iPod nano in town, and it's sporting that long, thin, somewhat rounded design that we've seen early on. There's a new widescreen that can be turned horizontally (thanks to a new built-in accelerometer, you can also "shake to shuffle"), and in that mode, it offers a Coverflow-style interface. Features like a stopwatch and even a Voice Recorder (with mic, presumably purchased separately) are available, and the battery life has been slightly updated: you can have 24 hours of music, or four hours of video.

The new models are available in blue, purple, orange, green, or pink, and the 8gb version is available right now at Apple stores for $149, with the 16gb version available for $199 as soon as next week. Headphones are sold separately for $29 next month, with an in-ear version available for $79, and both, we're told, include the clicker from the iPhone, where there's a small button you can click or double click to skip songs.

Stay tuned for more on the new nano later today, and keep with the TUAW liveblog of Apple's Let's Rock event for more new products and news.

Was is los in Deutschland heute? First the iTunes video store finally makes a German-language debut this week, and today we receive word via a T-Mobile press release that the first tiered-discount plan for iPhone purchases is now in effect. German buyers can take advantage of a limited-time offer (April 7 to June 30) to purchase an 8GB iPhone for as little as 99 euros, if they sign up for the top 2-year contract on a service plan (the Complete XL, 1000 minutes and 300 SMS for 89 euro a month) at buy time. Translated offer pages here and here. Lower-priced plans offer a comparatively lower discount, with the top price for an 8GB iPhone at 249 euros. Note that the 16 GB iPhone remains full freight at 499 euro.

Is this another example of the iPhone shortage phenomenon, or just some clever promotion by T-Mobile to enhance sales of the lower-end handset? Ach du meine Gute, ich bin völlig verwirrt.

Thanks Thorsten & c0caine

My compatriot Eliot and I tried to slog around the net this morning to figure out if this 8GB nano upgrade is a fraud. We are fairly sure that this is a complete fake (helped by the eBay strangeness and lack of proof photos). However, this did bring up a bit of a conundrum.

We couldn't find pictures of the insides of any 4GB iPod nanos without daughter boards. I personally seem to recall seeing them somewhere. The daughter board versions were the first ones to get ripped open and there are quite a few pictures floating around of those. I have a plea for you, dear TUAW reader. If you have pics of the inside of a 4GB nano without a daughter board, could you email a link to them to our tip line or leave the url in the comments? You will help our quest to weed out fake iPod memory upgrades.