The iPhone rumour mill has been hard at work, but amidst the stretches of truth is an indication the iPhone 5’s release is near.

Reuters reports that Asian suppliers are currently assembling a version of the iPhone 4 with 8GB of internal memory. An 8GB iPhone 4 would be the base model, creating competition between Apple’s own products.

But, Apple’s practices dictate whenever a new iPhone is about to be launched, the current generation is demoted to an 8GB version, with the 16GB and 32GB variants being inherited by the new model.

This happened to the iPhone 3G when it was replaced by the 3Gs.

It also happened to the 3Gs when it was replaced by the iPhone 4.

And now, there’s people assembling an 8GB iPhone 4. With this in the works, history would dictate we’re very close to an iPhone 5 release, coming with 16GB and 32GB of internal memory.

So far, rumours claim the new iPhone will have an A5 dual core processor (currently in the iPad), an 8 megapixel camera, a steel back and a thinner profile than the current generation of iPhone. It’s also said to be announced on the 7th of September, which coincides with reports of the 8GB iPhone 4 production date.

Read: Has Apple Accidently Revealed The iPhone 5 In Patent Application In OZ

With this being the longest Apple has put off releasing a new iPhone, there’s every chance the new iPhone 5 could be Apple’s most popular yet.