The rumored smaller iPhone is likely not to hit the market – at least not this year – or maybe not even next year. However, a cheaper iPhone is probably on the way according to the New York Times, contradicting an earlier Wall Street Journal report on the smaller iPhone topic.

The article published by the NYT says that Apple’s engineers are now focused on finishing the fifth-generation iPhone, and they do not plan to introduce a smaller iPhone but rather prepare the new smart-phone to be ready this summer. One important concern that prevents the Cupertino company from launching a smaller iPhone is the smaller screen, as this would force developers to rewrite their applications – something that the company wants to avoid.

Steve Jobs seemed to reinforce this point as he praised the iPhone’s uniformity, compared with phones based on the Android platform. “We think Android is very, very fragmented and getting more fragmented by the day. We think this is a huge strength for our approach compared with Google’s,” the NYT quoted.

Another consideration is company policy – it does not make sense to introduce multiple iPhone models, as the smaller iPhone would distract potential buyers from the iPhone 5. And Apple is planning to stick with its practice of dropping the price of older models when it introduces a new model.

What Apple is considering for the new generation smart-phone is changing internal components of the device to bring the costs down. The NYT went on to say:

Although the innards of the phone, including memory size or camera quality, could change to offer a less expensive model, the size of the device would not vary. The goal is that your photographs and other media content will eventually just sync across all your Apple devices without people having to do anything. If more iPhone users stored files online, Apple could make cheaper devices with less storage. Flash storage is one of the iPhone’s most expensive components.