Apple iPad: Apple's Plan to Compete with Cheaper Tablets

Apple will not come out with a 7in iPad. Instead, I think Apple will follow the model they have used with their iPhone line.  A new iPad 3 will emerge next year but instead of stopping production of the iPad 2, they will keep the iPad 2 and lower its price.  This will allow Apple to compete in the lower priced tablet market without compromising on user experience.

My belief isn't based on any sort of inside information or anything, but it is based on common sense and history.  To backup my belief a recent article from All Things Digital gives additional information that seems to prove my belief.