Video recording and auto focus equipped 3.2 MP camera in iPhone 3G S are the main reasons why people are upgrading to it. Video editing is built in the iPhone OS, and it also opens up video capture for other applications. iPod Touch seems to have been left far behind. But, TechCrunch has gotten some information from their sources in Asia:

One of our sources in Asia say that Apple has placed an order for a massive number of camera modules of the type that they include in the iPhone. These are inexpensive cameras, in the $10 range. And the size of the order, our source says, means they can only be used for one thing – the iPods.

A camera enabled iPod Touch in September would be the best upgrade to it currently. With the capabilities already available in the OS, a video recording enabled camera would make the next gen iPod Touch a run away hit. With just an increase of $10 in the overall price, this would be great bargain, although I doubt the price will increase as the cost of components keeps going down over time.

Couple this with direct uploading to YouTube, Facebook and other websites, and you’ve got another killer device in the making.

The Flip HD has tough competition on its way if the news turns out to be true.

One More Thing

An important point people seem to have missed is that the next gen iPod Touch will also be twice as fast as the current gen iPod Touch. Why? Because Apple only introduced a better camera, video capture and video editing once the iPhone had enough processing power and RAM in it to handle all these tasks with ease. This applies to the iPod Touch as well, so to get all these video capture and editing features it will have to be faster than before. This will also make it powerful enough to run the next gen games that will be available for the iPhone 3G S only with ease.

What does all this mean for the end user?

You’ll get a more powerful computing device in your hands by September with faster and better looking games, better apps, video capture, image capture and a lot more in the shape of the next iPod Touch. Zune HD should be worried.