I wonder how they will react to this press. It is not good. I certainly don't like my tracking data being stored, even if it is just locally.
They've got a PR issue on their hands.
excerpt:
Apple is working on a line of smaller, less-expensive iPhones and a software overhaul that would make it easier for customers to access entertainment and personal photos and videos.
The person who saw the prototype of the new iPhone said the device was significantly lighter than the iPhone 4 and had an edge-to-edge screen that could be manipulated by touch, as well as a virtual keyboard and voice-based navigation. The person said Apple, based in Cupertino, Calif., also plans to upgrade the iPhone 4.