iPad 3 mini on the way, says analyst

Apple's iPad 2 lineup.
(CBS) - Apple's iPad 3 is expected to be announced the first week of March, according to various reports. But, it's the rumor of a 7-inch mini iPad 3 that has people buzzing.

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Technology Business Research analyst Ezra Gottheil boldly declared to Computerworld that Apple allegedly plans to release a 7-inch mini tablet. But, don't expect to hear about it at the upcoming iPad 3 event.

"I believe that's always been in the plan," Gottheil told Computerworld. "Actually that's a good form factor for some users, and although they will also charge a premium above other similar-sized tablets, they want to protect that price flank."

Gottheil's predictions could just be pandering to budget-conscious gadget lovers, however. Apple's co-founder and long-time chief executive officer, the late Steve Jobs, rejected idea of a 7-inch tablet. Both the original iPad and iPad 2 are 9.7 inches. 

"7-inch tablets are tweeners: too big to compete with a smartphone and too small to compete with the iPad," Jobs said during a 2010 earnings call.

Apple has no incentive to launch a cheaper version of the iPad. There's not lack of demand for the tablet. Releasing a mini iPad would only pull customers from regular iPads, not necessarily mini-tablets, like the Kindle Fire or Barnes & Noble Nook.

Why would Apple release a cheaper product to cannibalize its own market share?

The Kindle Fire is the current leader in the 7-inch tablet market, with an estimated 6 million units sold last quarter. But, compare that to 15.43 million iPads sold. It's tough to justify a mini iPad.

While I personally hope for this rumor to be a true, I wouldn't place any bets on Gottheil's prediction. Until Apple makes a formal announcement, it's all speculation.


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