I expanded on the speculation here: A blog by a HP webOS Fan: HP Pre 3 = Palm c40 (part 1)
A blog by a HP webOS Fan: The Mysterious WebOS Slate (HP Pre 3 = Palm c40 part 2) (part 2)
“The first thing HP introduced to this testing lineup was a new prototype phone with specs they wanted to see in the two previous models. It had:
4" LCD capacitive glass screen
8MP camera with 720p recording
Front facing camera
960 x 640 resolution
DLNA support
1.2ghz CPU
We have been told that the portrait slider has undergone the most testing. There is a very good chance that the c40 will be shipped looking very much like a Palm Pre on Steroids. We may see many of the prototypes phone’s specs to be carried over to the revamped c40.”
This was great news, after the 960 x 640 screen resolution was spotted in user statistics in webOS apps, -- the iPhone wouldn't be the only phone with the "retina display" screen resolution. The device was predicted to be announced and available by the end of the year, but it never came.


Other rumors started spreading - a webOS successor with a 800 x 480 screen resolution and no physical keyboard.

Well, two months after the webOS "Think Beyond" event a photo of the alleged device was posted on precentral.net Count that in with webosroundup.com's latest rumor I think the device's specs will turn out to be somewhat like this:

4" LCD capacitive glass screen
960 x 640 resolution
1.2ghz Dual-Core snapdragon CPU
Adreno 220 GPU
1GB of RAM
32GB storage
SD card slot for additional storage
8MP camera with 720p recording
Front facing camera
webOS 3.x (Because all the great no-physical-keyboard stuff is in 3.0)
DLNA support
4G