This story (link provided) has been bounced around quite a bit today, and as the moon rises the verdict still seems to be out. The question? Well, are the photos you see actually photos of the next version of the iPhone; call it iPhone 4G (for 4th Generation, not 4G Mobile speeds).
From the looks of things Engadget broke the story, and from what I've read in the story the iPhone that was supposedly found in a San Jose bar inside an iPhone 3G case. When the phone was inspected it was found to have an 80 gig storage capacity and a decidedly new iPhone OS. Currently the phone doesn't seem to be working as it will not boot. The question then is simple: Is it real? If it is real then is it a prototype or a pre-production model. Most seem to believe that it isn't real, if only because it seems unlikely that Apple would allow it to stray so far from home.
Personally, I don't see Apple moving away from the current form factor, at least not to the degree these images indicate. The iPhone has a very distinctive look, that this model is lacking. Also, a MicroSD slot on it? I just don't see Apple doing that. Front facing camera - maybe. Camera with flash, possibly. High resolution screen - without a doubt. Personally, I say we just wait till July. We will know by then.
The photo below is from a TwitPic that apparently appeared back in February. This photo is again making the rounds.