Rumor: Apple still planning on releasing 7.85-inch iPad later this year

It looks like the fact that Apple’s iPad 3 event is less than a week away wasn’t enough to deter rumors of a smaller iPad coming in late 2012. We’ve been hearing about this “iPad mini” for what seems like much more than a year now.

The latest report comes from DigiTimes, who by the way appears to be rather busy this morning. The news outlet is claiming that Apple is looking to start mass production of a 7.85″ iPad sometime in the third quarter of this year…

“Makers in Apple’s iPad supply chain have started delivering samples of 7.85-inch iPads for verification, with volume production likely to begin in the third quarter of 2012 at the earliest, according to industry sources.

The planned launch of the 7.85-inch iPad is apparently to take on Amazon’s US$199 7-inch Kindle Fire as well as a comparable model from Barnes & Noble, although Apple already took up nearly a 60% share of the tablet PC market in 2011, indicated sources.

The price of the 7.85-inch iPad is likely to be set at US$249-299.”

We haven’t really been impressed with DigiTimes as of late, as the site appears to be throwing dozens of rumors against the wall to see what sticks. But this isn’t the first time we’ve heard word of a smaller iPad. Just last month The Wall Street Journal issued a similar report that Apple was showing its suppliers a tablet with a display measuring just under 8-inches.

Back in 2010, Steve Jobs publicly bashed the idea of a smaller tablet, stating that “there are clear limits of how close you can place physical elements on a touch screen, before users cannot reliably tap, flick, or pinch them.” But keep in mind that the CEO made similar condescending remarks about video iPods and tablets themselves — before the iPad debuted.

So does the 8-inch iPad exist? Yes. When there’s this much smoke, there’s usually a fire. But will we ever see the tablet materialize is a different story. We know one thing though, if Apple did release a $199-$249 8-inch tablet right before the holidays this year, we’d sure hate to be the competition.