The next iPhone, dubbed iPhone 5, will reportedly feature an in-cell touch panel, which results in a lighter device. An increase in production yield rates of the panels has convinced Apple to work with two companies.

Sources in Apple's supply chain say Apple is likely to adopt the panels manufactured by Sharp and Toshiba Mobile Display. "An improvement in yield rates of the in-cell touch panel at Sharp and TMD has persuaded Apple to choose to cooperate with Japan-based panel makers," DigiTimes' sources said.

Upcoming conferences, such as Touch Taiwan - running from April 29 - 31, 2012 - will highlight the technology.

"In-cell multitouch technology integrates touch into the thin-film transistor (TFT) LCD manufacturing process, obviating the need for additional sensors and glass. This reduces the weight of the device, among other benefits," Cnet reported. Consequently, rumors such as a 3D display could turn out to be true. It could also allow Apple to move to the much-rumoured teardrop design, as seen in the latest version of the iPod Touch.

Production will increase in Q2 2012, ahead of an expected Q3 iPhone 5 launch. The sources added that Sharp will use its 5.5G liens, while TMD will use 6G. If Apple continues to use the panels for upcoming iPhones - and possibly iPads - its current touch panel suppliers will be affected.

"The adoption of in-cell touch panels, if realized, will also have a significant impact on the operations of Apple's current touch panel suppliers TPK Holdings and Wintek, which are specialized in the production of glass on glass touch screens currently," the sources added.

TPK has since said the market will accommodate more than one technology, and the company is developing touch on lens glass. TPK also said the technology will be more suitable for high-end customized devices.

Meanwhile, a Foxconn recruiter claimed the company is hiring 18,000 new workers to support the launch of the device during June 2012. iPhones have typically launched in June or July, the exceptions being the delayed white iPhone 4 April 26, 2011, versus the black's June 24, 2011 GSM release date, and the iPhone 4S which launched October 14, 2011 in the U.S.

(reported by Jonathan Charles, edited by Dave Clark)