Apple will be introducing a next gen iPhone later this year. Some say it will be arriving in June, while others are expecting to see it in September. Either way, it will be more powerful and more than likely it will be a refined iPhone 4, perhaps called the iPhone 4S.
We hear today that Apple has been handing out a new prototype iPhone 4 that has been described as the 4S in that it looks identical to the iPhone 4 on the outside, but inside it carries an Apple A5 processor to speed things up.