The next iPhone firmware is rumored to have Chinese handwriting recognition built-in as reported by MacRumors and wretch.cc. This is a strong indicator the next Apple iPhone might officially invade Asian market first.

Users apparently can draw Chinese characters on the screen with their fingers. Suggestions for the character will appear on the right of the panel where users can then pick the right one.

Without further delay, Diotek, a mobile software company based in Korea, just announced the development of its DioPen, a handwriting software that will work on the iPhone when the 2.0 firmware allows 3rd party app.

DioPen works the same way as Windows Mobile handwriting recognition. The cool part is it can recognize  3 languages: Korean, Chinese, and English in either cursive or print characters. The software can be ported to other phones as well. [Via CNet]

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