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7-inch iPad 2 debut in 2011?

Current iPads
Current iPadsCourtesy of Apple

Samsung's 7-inch Galaxy Tablet competitors GigaOM Pegatron TheStreet

In the early days of the iPhone, the lack of competition allowed Apple to build up a sizable lead over others. However, the emergence of Android has started to take away some of the growth opportunities from Apple, as it has brought more options for consumers... A typical upgrade from Apple would involve Cupertino retaining the same display size for a few generations, like they did with the iPhone. In this case perhaps, the 7-inch tablet can lower the bill of materials and make it easier to source components like the display. Which in turn allows Apple to stay competitive in the emerging tablet market

ZDNet UK

One defect with the original iPad is that Apple pushed it out without a forward-facing camera to support the FaceTime video chatting service that it was just about to introduce in the iPhone 4. In fact, as teardowns noted, the iPad already had a space for the webcam, so it might be that Apple originally intended to ship it with a camera. If not, it clearly prepared for the idea. A generous soul might conclude that Apple simply couldn’t get the iPad finished in time, and didn’t want to delay the urgently-needed delivery of its new toy. A more cynical person might note that leaving out the camera would add more cash to Apple’s vast cashpile. After all, people happy to buy the first version without a camera would be even happier to buy the second version that included one. (Well, this approach worked for iPods.)