According to an extremely accurate analyst, Shaw Wu, the iPhone 5 will change everything (again). He claims that a large display combined with an even thinner profile will make this next iPhone one to remember:
It turns out that we are picking up that this interim iPhone refresh in the Fall timeframe could be a bigger upgrade than we expected. We believe this makes sense to improve the iPhone experience without making it too bulky as we have seen with models from competitors.
In addition, the change in screen size will result in an iPhone that’s only slightly bigger than the current iPhones (comparison pictured below):