There are two mains schools of through on the iPhone5 at the moment. One suggests the new iPhone will simply be a specs bump to the current iPhone4 in essentially the same form factor, the other, only being touted by BGR is that the 5 will in fact be a completely new hardware design.

Bloomberg has come out today with more evidence of the former, citing “two people familiar with the plans” as saying the new IPhone5 will include the new A5 processor debuted in the iPad2, and an 8 megapixel rear facing camera, increased from the current 5. No mention of new hardware or chassis design.

The new iPhone will closely resemble the iPhone 4, the people said.

Not surprisingly the people do not want to be named, so we are relying heavily on the judgement of Bloomberg here.

Also thrown in as tidbits are that Apple is working on a higher res iPad(3) display, and a smaller cheaper iPhone using iPhone4 level parts to target developing markets.

Given the release cycle, it makes more sense that the 5 would be more of an internal upgrade to the 4 – a ‘4S’ perhaps, in keeping with the 3 refresh to the 3G and the next round would include the main hardware and design revision.