Next-generation iPhones likely to focus on internal improvements.
Apple Has Worked on a Physical Game Controller for iPhone
I know of an internal Apple project to bring a physical controller to market, but whether or not it will ever see the light of day remains to be seen. As smartphones and tablets come close to equalling the performance of current game consoles, I feel like the controller problem must be addressed.
ION's iCade Mobile shown at CES
Apple is not the first company to have considered such a device for the iPhone and iPod Touch. Several 3rd party companies have worked on similar devices over the years. iControlPad was one of the first and is now shipping. Ion Audio's iCade followup (pictured above) also allows users to enclose their iOS device within a controller offering physical buttons and controls. Apple has even applied for a patent on a similar design.
These 3rd party solutions however have generally been relegated to keyboard emulation over Bluetooth rather than full fledged dock-supporting accessories. In fact, we'd heard that Apple had originally supported these accessory makers in their quest to make official dock-connector game controllers, but then the approval process was mysteriously halted. Some had speculated at the time that Apple was working on their own game controller solution. We've heard little else about this, though Atari's recently announced Arcade Joystick does now use the dock connector.