Increasing popularity of phablets among consumers might have forced Apple to consider a bigger iPhone with a screen as big as six inches. ADR Studio

With only a few days to go for next week’s Apple (NASDAQ:AAPL) event in Cupertino, Calif., where the company is expected to unveil next-generation devices -- the iPhone 5S and iPhone 5C -- a new report has claimed that Apple is currently testing a variety of new iPhone models with larger screen sizes, measuring up to six inches diagonally.

At a time when large-format smartphones, also called “phablets,” are gaining in popularity among consumers, the Wall Street Journal reported, on Thursday, that Apple is also considering exploring this particular segment by testing iPhones with screen sizes ranging from 4.8 inches to 6 inches. The existing iPhone 5 sports a 4-inch screen, while the upcoming iPhone 5S and the iPhone 5C are also expected to feature the same display size.

According to the WSJ report, which cited “people familiar with the matter,” it is unclear whether Apple will ultimately opt for a multi-size, multi-device strategy for its iPhone lineup, beyond offering the so-called cheaper iPhone 5C for the first time this year. However, it appears that the technology giant is quite open to the idea, with component suppliers saying that the company has been particularly interested in 4.8-inch screens.

Asked about the possibility of an Apple phablet during the company’s quarterly earnings call in April, CEO Tim Cook had said that a bigger iPhone would not be made until issues with certain “trade-offs,” such as battery life, color reproduction and longevity, are sorted out. And while Cook did not comment at the time on whether Apple is testing bigger screen sizes for the iPhone, speculation is rife that the company is indeed considering the idea as many of its competitors, including arch nemesis Samsung (KRX:005935), have already gained a foothold in the segment.

Acer (TPE:2353), announced its new Liquid S2 smartphone on Monday, featuring a six-inch full HD screen at a resolution of 1920x1080 pixels, while Samsung unveiled the Galaxy Note 3 on Wednesday with a 5.7-inch Full HD Super AMOLED display at a resolution of 1920x1080 pixels.

Meanwhile, analysts also believe that Apple needs to diversify its iPhone lineup as the company’s handset is at risk of losing more market share to its competitors. According to analysts, Apple needs to release both a bigger iPhone 6 and the lower-cost iPhone 5C to regain momentum in the worldwide smartphone market.

“Apple’s first priority should be a premium-tier phablet with a 5-inch screen because that is where the largest new revenue pool is located,” Neil Mawston, executive director at Strategy Analytics, recently told TechCrunch. “Apple’s second priority should be a lower-cost iPhone to win back some of the customers it is losing to cheaper Android models in Asia, Africa and Latin America.”

The rumor of a bigger iPhone coincides with a report from the International Data Corporation, or IDC, which said that phablets are gaining more popularity in Asian markets as they outsold both tablets and portable PCs in the Asia-Pacific region in the second quarter of this year. According to IDC, vendors shipped 25.2 million phablets in the second quarter of 2013, a 100 percent jump, or double the number shipped in the previous quarter. In comparison, Apple shipped 37.43 million iPhones in the second quarter, down 22 percent from 47.79 million iPhones it shipped in the first quarter.

Rumors about Apple’s plans to release iPhones with larger displays have been around for quite some time now.

Reuters reported, in June, that the iPhone iteration in 2014, unofficially dubbed “iPhone 6,” may come with at least two bigger screen sizes -- 4.7-inch and 5.7-inch -- as Apple is considering expanding its flagship smartphone range. In July, the WSJ came up with another report, saying that Apple and its component suppliers were testing new versions of both iPhones and iPads with increased screen sizes.

DigiTimes reported, in June, that Taiwan Semiconductor Manufacturing Company (NYSE:TSM) would manufacture the 20-nanometer "A8" processor expected to run the iPhone 6 in 2014, suggesting that Apple might be coming up with a faster chip to power a bigger phone.