The bar in Redwood City

Poor Gray Powell, a 27 year old software engineer working at Apple, inadvertently left his prototype of the next iPhone on a bar stool at Gourmet Haus Staudt, a German beer garden in Redwood City.

Steve Jobs is probably going to roast Gray over a slow fire, because that next generation iPhone was picked up by a guy sitting nearby, who tinkered with it and found a new iPhone camouflaged in an old iPhone package. After a few weeks, he sold it to Gizmodo (who paid $4000, some say $10K).

Gizmodo got its money’s worth, having a great deal of fun analyzing what’s different technically and in the design of the new prototype (and scoring off Apple’s notorious secrecy policy concerning new products).

They awarded the prototype excellent reviews. The new design was sturdier and more attractive, and the new model has a bigger battery and spectacularly sharper resolution.

Now, we get to sit back and see what Apple does to Gizmodo.