Apple Inc. is reportedly working on an 8-inch version of its best-selling iPad tablet in an effort to broaden its market share.

Rumors about a smaller version of Apple's iPad have been circulating for a while now. Last October there were reports that Apple was looking into a 7.85 inch screen. Since then reports about the rumored 8-inch iPad have surfaced in various tech blogs and news sites. This time the Wall Street Journal is taking a stab at it with a report citing unnamed sources inside Asian suppliers stating that Apple is working to build prototypes of an 8-inch iPad.

The unnamed sources said that smaller device will have "a similar resolution screen as the iPad 2" and that Apple is already working with screen manufacturers to build test panels of the device. The report names Taiwan-based Optronics Co. and LG Display Co. of South Korea as the screen manufacturers working with Apple on the 8-inch iPad. Apple is just testing out the smaller tablet and there's no guarantee that consumers will ever see the 8-inch iPad on the market.

While a smaller iPad would make sense, given that Amazon's 7-inch Kindle Fire is selling a lot of units and Apple would want to broaden its tablet portfolio, there are a number of reasons why the software giant won't release a smaller tablet. For one thing Apple's late co-founder Steve Jobs was vehemently against the idea. Jobs publicly stated that a tablet screen less than 10 inches just wouldn't work. In a quarterly earnings conference call, Jobs said that a 7-inch screen is too small to support the software.

"There are clear limits of how close you can place physical elements on a touch screen, before users cannot reliably tap, flick or pinch them. This is one of the key reasons we think the 10-inch screen size is the minimum size required to create great tablet apps."

Apple is expected to announce the iPad 3 in the next few months. The iPad 3 is rumored to have a retina display with nearly double the resolution of the first two iPad versions.