We don’t see this happening, but there have been rumors of Apple making some sort of wearable computers or iOS devices. They could have easily been prototypes or ideas for the next iPod nano.
This little mock-up is by an artist/designer named Federico Ciccarese. He’s known for doing other Apple product design mock-ups. This one is partly based on a New York Times report that Apple was working on some sort of curved-glass iPod that would fit around the wrist.
That sounds like it could be a variation of the iPod nano, which is currently also wearable with the right accessories.
Whether it becomes a reality is another story, but mock-ups are always fun.