After whetting your appetite for iPhone III rumors yesterday, today we bring you one more, and this one's even better: video recording could finally be on its way to the iPhone and iPod touch. This is more than rumor, because this screenshot was dug up from the iPhone 3.0 beta, clearly showing a little movie camera icon. Other enticements uncovered include a digital compass, auto-focus camera, and voice control. Hey, this is going to be good!

We've been playing with a video-recording app on our iPhone for months, but that's only possible if you hack into ("jailbreak") your iPhone, something that not everyone is willing to do. But it's great to be able to snag a few clips here and there, and from the looks of it, the new iPhone will be able to edit those clips, too.

UPDATE: Click "Continue Reading" to see three more screen shots of the video shooting and editing interface. It's real!

Looks like you can attach the video to a text message, too.

Via MacRumors