Everyday a new rumor about Apple surfaces about Apple's next-version of iPhone in the consumer market.

Lot of speculations is emerging over the new features of the iPhone 4 successor that is considered to be nothing short of an engineering marvel. Apple is expected to refresh its iPhone catalogue in September.

Some saying Apple will release two iPhones, while some saying only one phone will be released.

Meanwhile, Deutsche Bank analyst Chris Whitmore expects Apple to release iPhone 5 and a lower-end iPhone 4S handset in September.

With Nokia and RIM struggling, the time is right for Apple to aggressively penetrate the mid range smart-phonemarket (i.e. $300-500 category) to dramatically expand its market share.

Whitmore says that Apple could launch an unlocked version of iPhone 4S with prepaid voice offering.

We believe Apple could offer an unlocked iPhone 4S with a prepaid voice offering (parallels the 3G data plan vs. WiFi for iPad) which would drive significantly greater penetration into its 1.5B+ subscriber reach (2/3 are pre-paid) through 200+ carriers in 98 countries, Whitmore wrote in a recent note to clients.

Apple added 20 new carrier relationships in 8 additional countries in the June quarter, which Whitmore believes is supporting robust near term unit demand despite a well-anticipated iPhone refresh in September.

Currently, Apple has partnered with 205 carriers in 98 countries compared to 151 carriers in 88 countries in the prior year.

The analyst said Apple has reach into over 1.5 billion subscribers, of which about 500 are post-paid and 1 billion are pre-paid clients

Apple shipped about 87 million iPhone units over the past 2 years, indicating it has reached only 6 percent penetration of its current addressable subscribers.

Looking forward, we believe Apple has room to run both in terms of greater market penetration as well as incremental carrier additions going forward, Whitmore said.

Though skeptics say that a lower-end iPhone may hit margins, Whitmore thinks otherwise.

The analyst expects an iPhone 4S model priced at $349 would likely be incremental to Apple's corporate gross margin, suggesting it can push down-market without negatively impacting profitability.

Apple has made significant share gains in the smartphone market and currently has 17 percent share in the first quarter of 2011, placing it 2nd behind Nokia which continues to lose share.

Apple's share gains have been particularly impressive given that the company entered the market in 2007. In addition, Apple's share gains coincide with severe challenges at Nokia and BlackBerry who have experienced steady declines in market share over the last 2 years.

On the other hand, Samsung and HTC currently have 12 percent and 9 percent share, respectively due to growing adoption of the Android platform.