Microsoft’s Surface tablet strategy may not have got off to as brilliant a start as, say, the iPad or the Nexus 7, but the company is fully geared up to expand its tablet portfolio with a smaller tablet on the horizon. We have already heard that Microsoft is preparing a small tablet to move into a market it has never been a major player in.

CNET reports that Microsoft will be launching a new 7.5-inch tablet, which will take on the iPad mini and Nexus 7. More importantly, Microsoft is reportedly contemplating an aggressive pricing strategy for the smaller tablet, which is proving to be a key decision in the segment.

A PC in a tablet form factor

A PC in a tablet form factor

NPD DisplaySearch's analyst Richard Shim revealed that Microsoft is already in the advanced stage of planning for the smaller tablet. “From the supply chain side, we're seeing the panel specifications, the touch module and the mass production schedule being made.” Shim also said that Microsoft is expecting to ship many million units of the smaller tablet post its debut in the Q1 2014.

Not only is Microsoft prepared to take on the competition directly in terms of form factor, the company could also be packing some very high-end internals into the smaller tablet. The display is rumoured to be 1400 x 1050 pixels, which adds up to a pixel density of 233 ppi. Interestingly, this would place it higher than the iPad mini and the Nexus 7 at least in terms of pixel density.

Microsoft is also said to be in talks with manufacturers and suppliers to streamluine the delivery process of panel for all tablet sizes. This is a move to keep the price down. CNET further reports that the Redmond-based company is eyeing the $399 price bracket for the tablet. It may sound high at first, but Microsoft expects the price to stabilise once the tablet hits mass production. Currently, Microsoft’s larger Surface tablet with 32GB of storage is retailing for $499 (approx Rs 27,000).

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