As confirmed by Apple CEO Steve Jobs in September, Apple is already working on the development of the second-generation iPhone.

Now a report on SmartOffice claims the company may introduce the next-generation of the device as soon as January, when it claims the company may debut iPhone 2.

Apple has already spoken to manufacturing partners in Asia about the next generation of the iPhone, the report claims, observing: "major software and hardware changes are expected to be introduced to cater for non-US markets such as Europe, Asia and Australia."

The report puts forward what could be no more than a wish list of potential improvements: GPS, expanded WiFi capability and "the ability to sync with email servers," are all on the road map, the report states.