There might be a grain of truth in the rumor that Apple's next in line will be a 4-inch iPhone. 

There are rumors circulating that instead of two new devices being launched this year, Apple will instead go the way they did with the fifth installment of the iPhone – release three versions of the next generation Apple smartphone.

Citing Technews, China-based Digitimes reports that AU Optronics (AUO), a supplier of tech components, signed an agreement with Apple to provide iPhone panels for the upcoming device's launch. AUO is expected to supply Apply with three versions of iPhone panels: one measuring 4.7 inches, another at 5.5 inches, and lastly, a 4-inch panel for the smartphone. 

Additionally, it is also reported that Apple is still looking for other additional panel suppliers for both the current iPhones and upcoming models, and this move might signal the ramping up of Apple production in anticipation of releasing the next iPhone. 

However, it is unclear if the next 4-inch smartphone from Apple will be the seventh model of the iPhone, or if it will be an updated version of the current iPhone 6 instead. Apple is prone to releasing an updated version of its iPhones, a move that started with the iPhone 4s. Its successor, however, came in three versions – the original iPhone 5, and the updated 5s and 5c versions. The current iPhone 6, meanwhile, has the bigger iPhone 6 Plus for a brother. 

There are reports that instead of the new iPhone 7, Apple will release an updated version of the iPhone 6 and 6 Plus, and may even release a C version. If it is to be believed, the upcoming 6s and 6s Plus will have the company's newest A9 chipset, while the 4-inch iPhone 6c will use an A8 processor. The smaller iPhone would also serve as the inexpensive alternative for those who would want to use an Apple product without shelling out too much.