BGR says that it has heard from one of its Apple sources that Apple is planning to remove the Home button from the iPad, and then eventually from the iPhone as well. According to the sources, this is the reason why Apple has included multi-touch gestures for the iPad in the newly released iOS 4.3 beta. They say that the Home button will be completely removed in future versions of the iPad and iPhone, so that instead of clicking a physical button to reach the Home screen, youâ€™ll simply have to perform a specific gesture. The same goes for accessing the Multitasking bar, which is currently done by clicking on the Home button twice.
Not sure how I feel about this, I kind of like the Home button! And itâ€™s always handy to have physical buttons available if you need to do a hard reset. Currently if your iPad stops responding (happened to me the other day - scary!) you hold down both the On/Off switch and the Home button to perform a hard reset and get it going again.
Source: Exclusive: Apple will remove home button on next iPad and iPhone; Photo Booth and iLife coming? | BGR | Boy Genius Report