C|Net's French website is reporting that an upcoming Firmware update, to be released by Apple as early as Saturday, will include two added features that enable the iPhone to act as a USB Flash Drive when docked with a PC or Mac, and includes Voice recorder capability. Which means you'll be able to throw out all those thumb drives littering you desk, as well as that ridiculously obsolete handheld voice recorder.

Aside: I'd like to know how C|Net France came by this seemingly "insider" information. The whole things seems very dubious, but we'll see what happens tomorrow.