Reuters are reporting that Apple is getting ready to manufacture a 7 inch iPad for launch early next year. Yes, we’ve heard this all before. And yes, Steve Jobs has publicly denied the idea.

But then, as I have pointed out before, Apple have also denied the idea of mice with more than one button, iPods that play videos, Mac Net-books and a whole host of other products we have seen them produce nonetheless.

The Samsung Galaxy Tab has not been the breakout success as an “iPad Killer” that many thought it might. But it is not doing that badly in sales figures; having recently crossed the 1 Million units mark.

So with the market there to be exploited this rumour is not as crazy as some might think. With Apple rumoured to be moving to a higher resolution screen for the iPad 2, it is perhaps possible that the rumoured iPad 7″ sibling will offer a similar display to the current iPad in a smaller form factor.

This may of course all be Reuters getting their wires crossed. The iPad 2 is said itself to be smaller than the existing model. But that tends to contradict reports that the iPad 2 adverts have already been shot with existing iPad models in frame as they will be able to be replaced with iPad 2 images due to their similar size.

Reuters had this specifically to say :

A separate supply chain source said Apple was preparing a significantly smaller iPad that is almost half the size of the current model. The current iPad has a 9.7-inch screen.

So will the iPad 2 be smaller, or will we get two iPad 2s? What do you think? Let us know in the comments…

{Reuters}