Here’s the situation. Despite only effectively offering one model of iPhone Apple’s already made it into the top three handset makers on a global basis, despite competition from multiple products from other manufacturers (there’s more than one BlackBerry, after all). So, what’s a company going to do to maximise its reach? Diversify its product line, that’s what - just as with the slow extension of its iPod family.

Here’s the news: Overnight reports are claiming the company is developing a smaller, CDMA-compatible device for Verizon (and other CDMA networks), a device it intends releasing in Q3, 2010.

This rumoured device would host a Qualcomm hybrid CDMA/WCDMA chip and have a smaller 2.8-inch screen.

It’s by no means the first time Apple’s been rumoured to hold plans for a smaller device. The Dally Mail made such claims last year, speculating (incorrectly) that this would ship then.

We won’t labour this point, but we think Apple’s latest App Store approval blunder calls some of its core philosophies into question.

We know the App Store won’t sell overt erotica - even eBooks carrying the ancient love manual, the Kama Sutra, have been banned from the store - so we’re really, really keen to know how come the company approved a Spanish App containing Adolf Hitler’s Mein Kampf, complete with a swastika logo.

We can agree that Mein Kampf is a book that’s actually sold in the shops, but then again, so’s the Kama Sutra, and the latter title has seen eBook readers banned for including it.

You can take a look at nine more banned apps here. However, that the Mein Kampf app complete with Nazi swastika has been included on the Spanish version of the App Store while Kama Sutra hasn’t says that just being a book isn’t enough. Do take a look at TechCrunch’s angry opinion on this here.

The great thing about offering a hugely-popular development environment for a successful mobile device is just how quickly 1000,000 apps can reach your App Store, but Apple’s developers complain app discovery is flawed, leaving many earning less for their work than they think they should. However, the other great thing about a popular developer environment is that problems are solutions waiting to happen, and socially-connected app discovery is the iPhone developer response.

One of the first of what we predict will be a wave of these solutions is Chorus for the iPhone and iPod touch. Developed by envIO, the app helps us find whuch applications our friends are using.

You can connect with your friends to see the apps they're using, which apps they rate highly, and to stay up-to-date on new apps as they come through.

Chorus features real-time feeds from your designated friends, displaying the apps they are downloading, and what they are saying about them.

The Wall St. Journal is reporting that Radio Shack will begin selling the iPhone for the holidays in New York City and Dallas-Ft. Worth and will roll it out to all of its stores in 2010.  Seperately, Radio Shack will be operating Target's wireless phone business or "store-within a store" so it is conceivable that they'll sell the iPhones at Target as well

"The Shack" has been rumored to carry the iPhone for over a year.

If you have any of the iPhone games above, iPhone developer Storm 8 might have collected your iPhone number according to a lawsuit investigated by Boing Boing. 

...the suit claims that the practice is not authorized by Apple and involves the execution of "malicious software code".  Storm8 has written the software for all its games in such a way that it automatically accesses, collects, and transmits the wireless telephone number of each iPhone user who downloads any Storm8 game," the suit alleges. " ... Storm8, though, has no reason whatsoever to access the wireless phone numbers of the iPhones on which its games are installed."...The number farming was not disclosed to players until an acknowledgement in August that described it as a "bug." The lawsuit claims that only "very specific and specialized software code" could do so, however, and seeks injunctive relief and damages.

This follows news earlier this year that Mogo, a Swiss developer was stealing numbers, and calling their free customers to update to their paid app.

A couple of points to note:

• AT&T's poor network is really killing the iPhone's popularity and Pogue points this out.  As someone frequently in NYC, the iPhone is useless as a phone here.   I know many people who have an iPhone and still need to use a Verizon phone for phone calls.  The Droid will be tempting to them.  I've had similar experiences in SF.
• The Droid OS/apps are way less polished than the iPhone's.  While it isn't getting a lot of airtime, I think this is akin to Windows vs. Mac.  To many people, this won't matter. The Droid is definitely a techie phone.  Everything from the name to the feature-set is for techies.  Most people who've played with it so far are techie/journalists (like Pogue).  It will be interesting to see what everyday smartphone users think.
• Those docks are pretty cool but not a technology breakthrough.  Apple should allow docks to communicate with the OS so that Belkin can create a $20 car dock and nightstand dock.  OS 3.2?
• Not a fan of "App Phone"

Jim Goldman, below, is much more in favor of the iPhone.

Want to hitch a ride on another person’s inadequately secured internet connection - well, guess what, there’s an App for that...

Seems that iPhone App “Dessid” (€1.59, local prices vary) exploits a flaw that’s seemingly specific to Irish broadband users on the Eircom network.

Now, that flaw’s been repaired, but still 50 per cent of Eircom customers are using equipment that possess the problem. The problem occurs because each wireless network broadcasts a unique eight-digit code as its network name. That’s reasonable - what isn’t so reasonable is that the default password to the network is also derived from these eight digits. And, let’s face it, many users just don’t understand how to make their network more secure.

The acclaimed Musée du Louvre has introduced its own App through the App Store as Apple moves to open its first retail store to the French public in Paris at the Louvre Carrousel tomorrow morning.

We're not sure why you'd want to hold one key down and type with the other finger...but you can't do it on Droid.

We've heard the reports that Canada's Rogers was going to introduce an 8GB iPhone 3GS a few months ago, but now BGR is hearing that AT&T has similar plans to replace the low end $99 iPhone 3G with a faster iPhone 3GS.  Faster processor, more RAM faster network speeds at same price just in time for Christmas shoppers according to their source.  They also added:

One source said this was AT&T’s way of combating the DROID madness

We'll see soon if that's the case.