After the death of the iPods, the classic, nano, and shuffle, I was pretty sure that Apple would eventually get rid of the iPod touch as well. Alas, that has not happened and Apple has even upgraded as recently as 2019 with the A10 chip used in the iPhone 7 and 7 Plus. It was a surprise to everyone when it came up but I think it's time that Apple give it another go. And while I do not think it will likely happen, Apple should go big on it - give it a 6.1" screen like the iPhone 12, updated camera, and even a high end version with cellular connection.
Right now, I am using an iPhone 12 mini. While I have been upgrading my iPhone annually, my main daily driver was the original iPhone SE. And I love the size. But recently, I have trying to cut myself off as much as possible, even to the point of relying only on my cellular Apple Watch on weekends. One of the reasons is that I simply do not need to make calls anymore. I gather others are in the same position as I am. We just need a decent device for staying in touch in ways that everyone else is doing today - messaging or video chats like Facetime or Zoom.
An iPod touch with a 6" screen, A13 or even A14 chip, upgraded dual camera setup, 15 hours of battery life, and cellular connection is just such a device that I would need. I would not mind paying a premium for it.
Apple can even make a version with the same 4.7" screen that are used on the iPhone SE on the low end with an A13 chip, the same camera on the SE, and 10 hours of battery life on the low end. Yes, it is time that Apple ditch the smallish 4" screen. I gave that up and it's time Apple does as well.
I know that this is what I would like Apple to do but they're not likely going to do it - their cash cow is in selling the iPhones and iPod touch sales are not going to come close to those numbers. I still cannot help but think Apple has to be thinking down the road when phone numbers and the old ways of making voice connections will become obsolete and feature like Facetime will become the dominant means of audio and visual communication.
And let's face it, Facetime is the dominant means of communication in the iOS world but there are far more number of people using Android than iPhones. Apple has to do more to make sure Facetime is not supplemented by another communication app. Continuing to update the iPod touch with an inexpensive model and cellular model can address a larger segment of the non-iPhone market.
One other thing that is just as important to address for Apple is gaming. the iPod touch is a capable gaming machine but a high-end version of the touch with cellular connection would make it a monster gaming machine.
Apple's dominion of the mobile gaming machine exists and there is no double about it. Epic's fight to get more of the dollars from Apple is evident of that. Right now, it's biggest competitors are Android and the Nintendo Switch. A 6'1" screen iPod touch would be a huge leap in mobile gaming for Apple. Modern speed and graphics would bring in tons of young gamers who otherwise would have to keep borrowing from their parents or on diminutive and dated iPod touch. And for serious gamers, cellular connectivity is a must. Oh, and don't forget that Apple is serious-ish about gaming with the growing Apple Arcade service.
I'm sure Apple will address the iPod touch again - we are more likely than not of seeing a new form factory and updated chipset in it. How much Apple is willing to go with the update will be very telling about just what Apple thinks about the future of mobile computing and communication. Not to mention just how important the iPod touch in connecting users with Apple's growing segment of services.