Apple's famously tight lipped business practices have mad the company the target of intense speculation. There has been a rumor for over a year that Apple is trying to make a cell phone--no actual evidence but a lot of "chatter". Ross Rubin at Wireless Supersite thinks it's just wishful thinking:
"The dream will never die. Since Apple discontinued the Newton, Mac users have lamented that they haven't been able to take a little piece of their favorite computing experience with them wherever they are, preferably in a shirt pocket, so its radiation is close to their hearts."
Don't believe everything you read though--he sounds like he is out to get Apple. The truth is not many people know Apple's plans, and those that do aren't talking. If an iPhone does appear be rest assured that you'll hear about it here first.