BGR reported today that Android tablet vendors are reportedly very concerned over rumors that Apple is working on a 7.85-inch “iPad mini”, or is it an “iPod XL”? Android manufacturers, such as Amazon with their Kindle Fire, currently have a monopoly on 7-inch tablets. Apple already dominates the tablet market as a whole, boasting a 74% market share in the tablet market in 2011, but the 7-inch niche carved out by Android manufacturers has allowed them to survive and thrive within this space. It’s difficult now to quantitate the impact a mini iPad would have on Android tablet vendors, but one important distinction to me is the price point of the two offerings. Apple may very well introduce a smaller tablet to compete with Android, but it won’t be $199 – certainly not when the iPod Touch is priced at or above $199. An iPad mini would also be complete market cannibalization on Apple’s part, most people who are interested in the iPad mini are going to be people who already own an iPod or iPad and prefer the 7.85-inch display to current Apple offerings. Many Android fans are hoping that 2012 will be the year of the Android tablet, backed by Google’s announcement of a 7-inch Nexus tablet to debut in Q2.

Regardless, if Apple does choose to enter this space, it is likely that competition will intensify even further. Apple’s shareholder’s already aren’t too pleased that are being forced to make significantly lower income on the latest iPad, and, if they choose to enter the waters with a 7 inch tablet offering to compete against Amazon and Google directly, it’s likely that you and I – the consumers – will be the direct beneficiaries of such heated competition.

How do you think a 7.85-inch Apple tablet will impact the future of Android Tablets?

NEXT: Amazon’s Kindle Tablet – iPad Killer or Android Tablet Killer? Or Both?

Knockoff Android Tablet Nearly Identical to iPad Android will Defeat the iPad. And It Will Happen this Year