According to smartphone industry analysts, Apple may be developing a new device called an iPhone Mini this year, which will be a smaller 4-inch version of the company's current flagship smartphone.

Apple's most recent line of next-generation handsets came in a 4.7-inch iPhone 6 and a 6-inch iPhone 6 Plus. However, if rumors are to be believed, the Cupertino-based firm is planning to go smaller with a series of 4-inch handsets coming out sometime this year which might also have a budget price tag to match.

The analysts from Zacks Equity Research, a United States investment firm, is one among many sources talking about an upcoming iPhone Mini. Their team claimed that a 4-inch iPhone 6 was in the works and could possibly push through if Apple was able to come out with 10 million units per year. They also stated that the handset will likely be priced as high as the latest iPhone 6 handsets or as low as the entry-level iPhones.

Timothy Arcuri, an analyst of investment bank Cowen and Company, also made similar claims in a note issued to investors, a copy of which acquired by Apple Insider.

According to Arcuri, a 4-inch iPhone was currently in the works and will debut sometime this year. He also claimed that it was possible that the company will launch three versions of it next year, one of which is a rumored iPhone 6s mini.

Also, the specs of the rumored 4-inch models are probably going to be similar to the iPhone 5s, but will have the curved screen edges like the iPhone 6 and 6 Plus. Apple is also banking on "purpose-built low cost components" to help them keep them the price tag down.

Another way in which Apple could limit the high-end features and keep the price tag manageable is by going for a low-end camera and processor. However, some consumers may find themselves torn between the phone's specs and the price.

Salim Ahmad, a trader at Al Ain Centre in Dubai, claimed, "Without a serious price drop, I do not see anyone opting for a 4-inch device."