(Credit: Apple)

More iPhone Nano rumours are surfacing out of China, as some are starting to wonder whether the much-rumoured diminutive iPhone will ship in that region only.

Digitimes picked up on a report from the Economic Daily News that chip makers Taiwan Semiconductor Manufacturing Co (TSMC) and United Microelectronics Corp (UMC) are set to get the contract to make chips for an iPhone Nano, which was described as a "low-cost entry-level" iPhone. TSMC and UMC are perhaps the two most well-known chip foundries in the business, and may be getting ready to execute Apple's first iPhone chip design put together by the PA Semi team.

No other details were reported. But what of the iPhone Nano itself? Rumours first appeared about such a device in 2007, shortly after the launch of the original iPhone, but quickly died. They were revived late last year when an iPhone case manufacturer added an "iPhone Nano" category to its products.

There's a theory that the real iPhone Nano is merely the knock-off versions sold in markets in China and other places in Asia, which has proven so popular that demand has grown for cases. But Brian Marshal of Broadpoint AmTech expects Apple to launch such a device at some point this year, and thinks Asia might be the first place it arrives.

Marshal said his checks with suppliers show that AT&T has not received the device yet for testing, which he believes indicates that China could be the likely launch venue for the iPhone Nano and a new Apple relationship with China Mobile or another carrier. If this iPhone really does exist, a June launch would make sense given the pattern set in 2007 and 2008.