Primarily the rumor is off the back of reports that Samsung and Toshiba are ramping up production fo the 8GBit NAND memory, which would give rise to such large shuffles.
Now the first response of most people has been along the lines of ‘who wants to navigate 4Gb of songs when you don’t have an LCD’. They are right, of course. I have just over 200 songs on my Shuffle and even that number can be annoying to look through if I want something specific.
However, the Shuffle isn’t just a music player. It’s also a USB drive, if that’s what you want. Although I have space on my Shuffle to use it as a drive and to store my music (I’m using about 560MB of a 1GB unit), for convenience I also carry a 1GB iStick which is little more than an inch long and handy because it’s so small. This means I carry two things with me, but in the scheme things it’s slightly more convenient, as I often need that 1GB of storage.
With a 4GB shuffle I could just carry the shuffle everywhere; it would give me 3.5GB of storage to play with for stuff other than my music and that would be more than enough for the stuff I carry on my iStick and some simple backups too. I could even include some photos and still have room to spare.
Remember folks; your Shuffle is not just a music player (come to that, no other iPod is either). Reducing the amount we all carry is, I think, a Good Thing™.