The publication goes on to describe the “delayed bubble” defect which the source warns is difficult to avoid if it isn’t detected early on during the process of laminating touch panels. Sources assure the publication that Wintek “is expected to remedy the defect quickly” given that iPhone 5 and iPhone 4 utilize the same touch panel manufacturing procedures.

The report contradicts this story, also from DIGITIMES, calling for 150,000 iPhone 5s being produced every day by Foxconn, waiting for iOS 5 to be finalized and preinstalled on the devices before shipping can commence. In the light of today’s rumor, however, it is possible that the iPhone 4S production has been in full swing rather than iPhone 5 and newest Otter Box cases would certainly reinforce this thinking.

Apple facing manufacturing difficulties isn’t unheard of. Remember white iPhone 4? It took the company eight months to figure out how to make it work so that light leakage doesn’t degrade camera performance. Also, Antennagate anyone? Let’s not forget that Apple’s products are “very difficult to make” and that’s from Terry Gou, the CEO of Apple’s long-time contract manufacturer Hon Hai Precision Industry, also known as Foxconn. For all we know, Gou might have been referring to iPhone 5 when he made that comment back in June.

If DIGITIMES’ report is true, this development is likely to hurt Apple’s initial iPhone 5 shipments, leading to tight supplies at launch. Analysts expect Apple to ship about 25-30 million iPhone 5 units in the holiday quarter. A recent ChangeWave survey described demand for iPhone 5 as “unprecedented”. UBS Research concluded, based on a survey of 515 smartphone users, that up to one-third of Android users are considering switching to an iPhone as users of Apple’s handset are the most loyal smartphone owners, with a retention rate of 89 percent.