AppleInsider has a very exciting rumor about the iPhone roadmap including two lines by the holiday season in 2007. According to their sources, the so-called iPhone nano will have iPod and phone functionality and its own revolutionary user interface, but will lack web browsing, email, and other resource-intensive abilities. Though it’s not mentioned, it seems likely that at least some camera functionality will be included, as so few phones these days don’t have at least a basic camera.

Prices are expected to fall between the iPhone and iPod nano, with the goal being to avoid cannibalization of either line and maintain clear distinctions in their market. Count us as excited.

Filed under: iPhone News, Rumor