Steve Jobs was very made it quite apparent that Apple would stick to their 9.7 inch displays for iPad and not cater a smaller screen size claiming that such a tablet would be dead on arrival.
While 7 inch Android tablets have not fared so well, the popularity of the Amazon Kindle Fire could be making the new regime at Apple rethink their strategy. If apple does go ahead with their 7 inch iPad plans we should be seeing them alongside their larger counterparts early in 2012 as rumors of Apple having begun iPad 3 productions have been circulating for some time now.
I am curious if the 7 inch tablet would turn out to be the next generation iPod Touch.