Bloomberg is reporting that the iPhone may be breaking onto America’s favorite network in January of next year. The report cites two unnamed sources who are, as always, close to the issue.

There has been a lot of speculation about the end of the AT&T exclusivity arrangement, especially when AT&T started offering up iPhone 4 upgrades to anyone that would take one.

The device will be available to customers in January, according to the people, who declined to be named because the information isn’t public. Natalie Kerris, an Apple spokeswoman, and Jeffrey Nelson, a Verizon Wireless spokesman, declined to comment.

The iPhone, which has been the sole domain of rival AT&T in the U.S. since June 2007, will give Verizon a boost in its competition for smartphone customers, UBS AG analyst John Hodulik said in an interview. Verizon customers, who numbered 92.8 million at the end of the first quarter, may buy 3 million iPhones a quarter, he estimates.

For now I’ll remain skeptical, if only because there have been rumors of a Verizon iPhone for years now. Actually, I just don’t want to believe I signed with AT&T when Verizon was just around the corner.

iPhone Nano rumors started to resurface this week, based on photos from a manufacturer and supposed insider reports that Apple is working up a device for Verizon’s CDMA network.

The rumored device would sport a hybrid UMTS/CDMA radio, making it compatible with pretty much any network. The screen is down from 3.5 inches to 2.8, which seems way too small to me. Granted, there’s always zooming to get to hard to read text, but there’s really nothing worse than scrolling a page around while you’re trying to read.

Speculation points to a 2010 release, which would make sense considering the massive Android rollout that has been taking place. As Android makes it onto more devices, particularly cheaper ones, Apple’s going to want a way to get those entry-level smartphone owners. A smaller iPhone might not get those folks, but a cheaper one definitely would.