Apple Invitation

An invitation sent to reporters on Thursday said only "Let us loop you in." Apple's headquarters is located on a road called Infinite Loop in Cupertino, California.

Apple will hold its spring product launch on March 21, one day before it squares off with federal prosecutors over the government's demand for help unlocking an encrypted iPhone.

Analysts and tech blogs are expecting Apple will announce a new, 4-inch iPhone, a smaller iPad Pro and new bands for the Apple Watch. But the company provided no details with its announcement of the event, in keeping with its usual effort to build anticipation for its new products.

An invitation sent to reporters on Thursday said only "Let us loop you in." Apple's headquarters is located on a road called Infinite Loop in Cupertino, California.

Apple's twice-yearly product events are highly anticipated and the speculation that precedes them is rampant. The backdrop to this year's event is a high-stakes legal dispute with the FBI and the Obama administration, which has chafed at Apple's use of encryption that make its customers' data unreadable to others.

Federal authorities want Apple's help in over-riding security features on an iPhone used by one of the San Bernardino mass shooters, so the FBI can attempt to examine the phone. Apple CEO Tim Cook contends the government's demand would make other iPhones vulnerable. Both sides will make their case to a federal magistrate in Riverside on March 22.

While Apple executives say the company is continually working on increased security measures, they haven't said whether they will announce any new encryption or other safeguards at this month's event. What is more certain is a push by Apple to boost sales with new versions of some popular products.

A 4-inch iPhone would reverse an industry trend, which has turned out larger and larger screens. The most recent iPhone models have come with 4.7- or 5.5-inch screens, which have sold extremely well, particularly in Asian countries where larger phones made by Apple's rivals had been big sellers in previous years.

Smaller, cheaper model

But with sales now starting to plateau, analysts say Apple could spark additional demand by offering an updated 4-inch iPhone alongside the bigger models. The smaller phone is expected to sell at a lower price and would appeal to those who never bought into the larger screens. In an upgrade from older 4-inch iPhones, the new model is expected to have a faster processor and features like Apple Pay, which until now has been available only on larger iPhones.

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The iPhone 6S Plus has a 5.5-inch screen. A 4-inch iPhone would reverse an industry trend, which has turned out larger and larger screens. (Robert Galbraith/Reuters)

Similarly, Apple has been trying to boost sagging iPad sales by offering more sizes and models. The new iPad tablet is expected to be a 9.7-inch version of the iPad Pro, which Apple introduced last year. While the new model will be the same size as Apple's regular iPads, it's also a step back from the first iPad Pro, which has a larger, 12.9-inch screen and other features for professional users — including a thin, detachable keyboard and stylus that are sold separately.

Tablet sales from all makers are expected to fall nearly 6 per cent this year, according to analysts at International Data Corp., but more people are buying new models with detachable keyboards. A longtime Apple rival, Microsoft, has seen strong demand for its Surface Pro tablets with keyboards.