The most awaiting product of Apple, iPhone 5 is reportedly developing a scanning application which allows its customers to turn snaps into real documents which they can edit, complete with a function to separate text from imagery.

In addition to achieving crystal clear images, the iPhone 5 would also come with necessary software to break down the images into what each element represents, for instance, if you snap a business card, iOS would be able to translate that into real card that goes into your address book.

The app will work as follows :

1. “The user opens the app and holds the iPhone over the document or object they want scanned. They then snap a picture of it. Apple’s on-board software then resizes the image to ‘letter’ or business card, A4 or whatever depending on original document. Resizing includes aligning edges that get skewed by a sigle scan point rather than traditional scanning methods. The user can then manually change the size of the document or the use (biz card?)”

2. “On board software then separates images blocks from text.”

3. “This is where it gets murky. At last word, Apple was trying to do OCR both on-device and using alternative cloud methods for recognizing text. Third party Optical Character Recognition (OCR) vs. in house solutions were also being tested.”

4. “The resulting file can then be saved as a PDF, .Pages, exported to contacts (in the case of business cards for example).”

The app would tie in with Apple’s own iWork suite for scanning documents into pages and the company has filed a number of patents related to scanning as well, so this type of app could very well be real and in work.