The main reason that Android phones have such large screens is to fit the massive battery that's needed for LTE. Hungrier chips = bigger battery. Phones either had to get thicker or longer.
If the next-gen iPhone is to be LTE, it'll probably have a new battery technology.
That's silly and counter productive. Too accommodate for a bigger battery so it last longer they use a more power hungry screen?
Look at the razr it's battery is paper thin. They could easily make a slightly thicker phone with a smaller screen. And I have no doubt Motorola could make an iPhone with near identical spec but half as thick. But there is no market for an iPhone like phone made by anyone other then apple. I'm not saying thinner is better either I like a little thickness to a phone.
I'd be willing to bet money if apple made both a 3.5 and 4.3 phone the 4.3 would dominate sales and apple would totally drop the 3.5 variant.
Apple doesn't need new battery tech they need the next gen in LTE tech which is what they and everyone else is working on. I read a lengthy article on it and it's something to do with the technology used to manufacture the LTE chip an how an advancement is needed to decrease power consumption.