Here's a rumor that just won't die: Apple's coming out with an affordable 7-inch iPad. This time the perpetrators are iMore, citing the usual anonymous sources. The claim that the smaller iPad is due in October of this year, and that Apple is aiming for a retail price between $200 and $250. The exact screen dimensions aren't mentioned, but they're using 7 inches (a popular Android tablet size) as a sort of conceptual generic. They claim that the cheapest model will start at 8GB.
There are some reasons why a smaller, or at least cheaper, iPad would make sense. Amazon and Barnes & Noble aren't outselling the iPad by any means, and most report that they're barely breaking even on their hardware costs, but the continuing market of Android "reader-tablets" proves that there are people willing to spend $200 on something that isn't an iPad. And as Apple is downright crushing its competition ant $500 and above (and the iPad 2 is now even less expensive) releasing a "budget" model could cement their place at the top for years. There's always the chance that Apple knows something we don't, and is planning a competitor to Google's rumored Nexus Tablet, said to cost about the same.
Then again, whenever I hear rumors of the new 7-inch iPad (which resolutely failed to appear at Apple's last event) I can't help but think of the late Steve Jobs' proclamation upon seeing the original 7-inch Galaxy Tab: "it is meaningless unless your tablet also includes sandpaper, so that the user can sand down their fingers to around one-quarter of their present size." In any case, the rumors seem to keep pushing the fabled device farther and farther back. Maybe we'll finally get one when the iPad 7G (or whatever it's called) comes out.