In 2011, Eddie Cue, Apple’s SVP of Internet Services, apparently emailed Apple SVP of iOS, Scott Forstall mentioning that Jobs was open to the idea of a Samsung Galaxy Tab sized (7-inch) iPad Mini. The news came to light as part of the ongoing Apple vs. Samsung trial. According to Bryan Bishop from The Verge:
Forstall is shown a 2011 email from Eddy Cue, in which Cue forwarded an article that a journalist wrote about dumping the iPad after using a Galaxy Tab. Cue writes "Having used a Samsung Galaxy [Tab], i tend to agree with many of the comments below... I believe there will be a 7-inch market and we should do one. I expressed this to Steve several times since Thanksgiving and he seemed very receptive the last time."
After several months of rumors and speculation, the 7-inch iPad is believed to be announced at a media event on September 12th along with the next-generation iPhone according to recent reports. We’ll have to wait and see if this turns out to be true.
Source: The Verge