The possibility of Apple releasing a smaller iPad seems a bit more likely, with a report Wednesday that the tablet is already on the production line. Apple suppliers are kicking into high gear for the project, according to a Wall Street Journal article that cites unnamed sources “with knowledge of the situation.”

The report largely confirms much of what’s already been floating around about the mini iPad: it will have a 7.85-inch display and is expected to be announced this month.

Apple has been slow to the segment, something many people assumed was because its late co-founder Steve Jobs was an outspoken critic of tablets with smaller screens. Yet Jobs was reportedly warming up to the idea as the technology improved and was “receptive” to the idea of a smaller device, according to court testimony from this summer’s Samsung trial.

A mini iPad has the potential to do a couple of good things for Apple. Google and Amazon have made big splashes with small tablets by successfully selling them as convenient, entertaining and good for doing a bit of work. Grabbing a piece of that market would be great for Apple, and many analysts believe Apple would come to dominate the space.

The smaller form factor would help the company sell its wares to commuters who may find the iPhone screen too small for reading and browsing. Plus, a lower price point could help the company snatch even more of the tablet market — according to an August IHS report, at least 64 percent of the market belongs to the iPad.

On the flip side, Macworld’s Dan Moren wrote Wednesday that he thinks the timing of such a release is not quite right.

“Sure, launching an iPad mini right now would position the device for a blockbuster holiday release,” he wrote. But he doesn’t think that a smaller iPad is enough to warrant its own major event. And the iPad, he pointed out, generally gets its refresh in March.

With all the chatter about Apple becoming a company of iteration, not innovation, Moren thinks that releasing a smaller iPad with all the pomp of a new product will invite even more criticism.

As always, Apple hasn’t even confirmed the existence of a mini iPad. So even with production rumors, leaks of supposed images of the device and a clear spot in the market, people should remember that everything out there is pure speculation.

As is always the case with Apple, we won’t know exactly what they’re doing until there’s an executive up on stage, so it’s best for Apple fans to just sit back and enjoy the buzz. Rumor has it that invitations to an event for a mini iPad are coming next week, so at least we won’t have long to wait.

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