The Wall Street Journal is reporting that Apple is testing iPads with screens measuring "slightly less" than 13 inches and also iPhones with screens larger than four inches:
In recent months, Apple has asked for prototype smartphone screens larger than four inches and has also asked for screen designs for a new tablet device measuring slightly less than 13 inches diagonally, they said. The current iPhone 5 has a four-inch screen, while the iPad has a 9.7-inch screen. The iPad mini, a stripped-down version of its tablet computer, has a 7.9-inch screen.
Reports of an almost-13-inch iPad may seem bizarre, but the Wall Street Journal has a good track record with Apple rumors. The paper also notes that it's entirely possible that these iPads may never see the light of day. An iPhone with a screen larger than four inches might be easier for people to believe and seems more reasonable than Apple releasing a 13-inch iPad. However, months before Apple introduced a 17-inch MacBook Pro, the rumors of such a device were quickly dismissed as most laptops at the time didn't go any larger than 15 inches. Then the 17-inch MacBook Pro did come out and lead the way for higher-end professional laptops for years to come.