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Actually, I'd expect the cloud version to be more expensive since it could, technically, have unlimited storage.
 
No way. iCloud is not a streaming service. This would only hurt the iPhone when it comes to using several features that really make the iPhone the iPhone.

Music
Videos
Email
etc
 
It's an interesting rumour, although I think this concept would work better on an iPod touch, not an iPhone.
 
It's an interesting rumour, although I think this concept would work better on an iPod touch, not an iPhone.

How? With no local storage, how would you play music without a WiFi connection? What would you do if you were on a plane or in a car for hours on end?

If this happens to either the iPhone or iPod Touch, I think Apple would have great reason to call them 'iBricks'.
 
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