As tablet players are turning their focuses from the 10-inch segment to 7-inch for the second half of 2013, sources from the upstream supply chain believe the competition between Apple iPad mini and 7-inch Android tablets will become fiercer than before.

Cumulative shipments of the first-generation Nexus 7 are estimated to have reached around 4-4.5 million units since its launch in the second half of 2012. Google and Asustek Computer are already set to release their second-generation Nexus 7, using a Qualcomm processor, in May and will start mass shipping in July.

Apple's total iPad shipments were 19.5 million units from January to March, of which iPad mini accounted for 12.5 million units, showing that the 7- to 8-inch segment has already become the mainstream of the market, said the sources, adding that the second-generation iPad mini could make an appearance as soon as August.

Although Microsoft also plans to join the 7-inch tablet competition for the second half with Windows 8/RT-based devices, due to the operating systems' poor ratings, the sources believe the software giant might suffer from great disadvantages in the competition.

Of other hands, first-tier PC players are also aggressively developing their own tablets. Asustek recently launched its MeMO Pad ME172V, using VIA Technologies' ARM-based platform, priced at NT$5,490 (US$186).

Acer also released its Iconia B1, using MediaTek's platform, priced at NT$4,690 and Micro-Star International (MSI) its Enjoy 71, priced at NT$4,990. However, the three vendors have kept a low profile with promotion, on concerns that the devices' entry-level pricing may damage their brand image.

China-based white-box tablet players are also experiencing fierce price competition, but compared to white-box players, which are competing at a price level around US$99, US$159 is the bottom line of branded tablets, considering costs for after-sale maintenance and retail channel profits.

Intel has also cooperated with the China-based supply chain to release entry-level Android tablets such as the Ramos W32 and Coby MID1054 to promote its platform.