A wild rumor tops the tech stories right now on Techmeme. BGR reports that their Apple sources told them that Apple removes the hardware home button from the next generation iPhone and iPad. The home button functions are supposed to be replaced by multitouch gestures. Some of them already appear in the upcoming iOS 4.3 update. What is my 2 year old son is going to do? He relies on the home button to activate the iPhone and close games. Don't we all rely on the home button?
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To just use gestures to exit apps, switch to the task manager and so on would totally increase the entry level for new iPad and iPhone users. It would be just not obvious. See also Daring Fireball's comment about this.
The only way to replace the hardware home button would be to display it on the screen. This would mean we are back to the desktop UI where you have a caption on top the app Windows. Then there is still the question how to activate the iPhone. Sure Apple could use the proximity and other sensors to activate the iPhone when you grab it, but will that work as expected? Will the iPhone switch itself on in my pocket? Questions over questions.
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I am all for reduction and minimalism as long as it aids simplicity. That is why Apple products are great. If one button is really too many is highly questionable.