iPhone 4’s Camera is still one of the best in Mobile Phone market, no doubt the picture quality is the best. But one of the weakest point of the camera is the flash. Although Flash helped in night/dark photography on iPhone 4, but it almost always overexpose the picture or cause the photo to have a very white patch in the top area of the photo.
Thus the next iPhone, iPhone 4S or iPhone 5 is rumored to have Camera and Flash separated, thus to reduce the overexposure and hopefully take better night photos. Below is a mock up of iPhone 4S with Camera and Flash separated by Apple.pro.