Although Apple should be credited for creating the market for media tablets, it didn’t see the biggest sales trend in this market at all—the rush to smaller, 7" devices. That misstep has destroyed Apple’s lead in this new market as hardware makers rush to push inexpensive mini tablets out to consumers. But where’s Microsoft?

You can think of these mini-tablets as the new netbook: small, inexpensive, highly mobile, and immediately popular with budget-conscious consumers. And like netbooks, mini-tablets don’t generally replace existing devices like PCs but are rather used as companion devices that let users continue using existing PCs for longer periods of time.

But unlike netbooks, these mini-tablets offer a compelling user experience in addition to low prices. Whereas a netbook was essentially a real PC crammed into a low-end and uncomfortably tiny device, the mini-tablet is emerging as the mainstream form factor in this product category because the combination of size, weight, battery life, and performance feels just right.

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Some might find it odd that Apple didn’t immediately understand the need for this market, given that the release of the first iPad in early 2010 jumpstarted the market for media tablets. But when the first 7" tablets arrived on the scene later that year, then-Apple CEO Steve Jobs dismissed them as toys.

“Seven-inch tablets are tweeners: too big to compete with a smartphone and too small to compete with the iPad,” Jobs opined during a 2010 earnings call with analysts. “The current crop of 7" tablets are going to be DOA, dead on arrival.”

In the year following that statement, Amazon, Google, Samsung, and other Android tablet makers sold millions of those tablets, causing Apple to backtrack and release the iPad mini, belatedly, in late 2012. Apple, long seen as a leader, was now following other companies into what was clearly a lucrative market and—more important—the mainstream market for these devices. And the iPad, which once dominated the market it invented, already controls less than 50 percent of that market.

Of course, some companies are even slower than Apple. In the same selling period in which Apple finally launched the iPad mini, Microsoft finally released its first tablet, Surface RT, a full-sized 10.6" design that competes head-to-head with the original iPad. Over three months later, Microsoft shipped another tablet, Surface Pro, also a 10.6" design. The first mini tablets based on Windows, from Microsoft and its partners, aren’t expected until the second half of 2013.

I reported previously that Microsoft plans to ship an 8" Surface tablet sometime in late 2013 (though a later Wall Street Journal report claims that the device will have a 7" screen). But by the time this device and those from Microsoft’s partners arrive, there will be even more competition. New mini tablet designs are announced all the time, and given Apple’s traditional product development schedule, one can expect a second-generation iPad mini—probably with a high-resolution “retina” display—before the close of the year.

Further troubling to the Microsoft ecosystems, the mobile market continues to blur thanks to ever-bigger smartphone designs, sometimes called “phablets,” which feature screens in the 5"-to-6" range. Nokia is rumored to be working on such a device—and a traditional tablet as well—and could announce something as soon as mid-May at a mysterious Lumia launch event in London. But for now, at least, the market for phablets is all Android, and the market for mini-tablets is split between Android and Apple.

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