While Apple hasn't confirmed much on the 3rd generation iPhone, the leaked specifications sure seem like they would fit right with the healthy increase in performance that most are expecting when the new phone hits.
Dubbed the iPhone HD, the processor will get a 200MHz increase over the 3G iPhone bringing the CPU up to 600MHz. Storage and RAM will both be doubled, giving the iPhone HD 256MB of memory and 32GB of strage.
The camera is also getting an upgrade, bringing autofocus with the 3.2MP camera. Other features new to the iPhone HD will include an FM radio and a digital compass. Nobody is saying when the iPhone HD will hit the market but some are saying that it could come as soon ad next month's WWDC convention.