Apple preps new camera-toting iPads: sources

Component suppliers for the U.S. company are gearing up for a new round of production in the first quarter, these sources said on Friday.

A smaller iPad would be a departure as Apple Chief Executive Steve Jobs has publicly rejected the idea of such a device in October.

Apple's iPad resurrected the market for tablet computers since its introduction in January, with nearly 13 million shipments expected units this year. That total could almost triple next year, providing a much needed boost for a global technology sector still struggling with patchy demand.

Touchscreen chip designer Wintek Corp, battery maker Simplo Technology Co Ltd and AVY Precision, a privately held maker of covers for electronic products, are among suppliers for the next batch of iPads, four people familiar with the situation said.

Two sources said the suppliers were preparing for a new round of production in the first quarter for components previously supplied for the original iPad, while two other sources said they were ramping up for a new iPad.

One source said the revamped model would feature cameras on the front and back of the device, enabling Apple's Facetime video conferencing service. Another source said it would be slimmer, lighter and have a better resolution display than the first iPad.

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.

In October, Apple Chief Executive Steve Jobs had dismissed the idea of a 7-inch iPad, saying the screen would be "too small to express the software."

INVESTMENT THEME

"Investing in Apple-related shares is going to be a major theme for most of next year," said Bevan Yeh, a fund manager at Prudential Securities investment Trust, who manages about T$7 billion ($230 million) and owns supplier shares.

"Apple is still the main driver on most technology products, and this will help push the earnings of its suppliers even more in 2011," Yeh said.

Apple is expected to ship 12.9 million iPads this year, with shipments rising to 36.5 million in 2011, research firm iSuppli said in July, reflecting an 84 percent share of the tablet PC market.