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It seems like something really is coming this time, finally. So what gives? Tablets aren’t that popular, and who wants a bigger iPhone/iPod Touch that won’t fit in your pocket? Here’s what gives-

It won’t be just a ‘tablet’, or a big iPod Touch. A bigger iPod Touch in itself is not enough, that by itself doesn’t add anything you can’t already do on an iPod Touch or iPhone. It will be an (almost) fully-featured computer that runs on the Touch OS.

I think they want to develop something that addresses the needs and desires of netbook users/potential buyers, but without the overhead of a full desktop operating system. Now take that saved overhead, and put it into snappier performance and better design/hardware/user experience (and a little bit for Apple’s profit margin.) Because if you look at the majority of netbook users, you’re mainly looking at web, email, and light productivity work- does that require a full desktop OS? No- and this is the starting point for this new Apple product. You can really address most potential netbook users with a Touch OS-based device, and gain some nice advantages in the process. Keep in mind that the Touch OS interface is not just an amazingly great mobile interface- it’s an amazingly great interface, period.

Let’s say they add an even faster than 3GS processor with that ~10″ display, with video hardware capable of at least 720p as well. It runs a modified Touch OS (and runs it REALLY fast) with some extras. Some sort of iWork type suite, as well as enhanced iLife type apps (good thing Apple has developed these productivity/lifestyle app suites to start from.) And a built-in keyboard, or perhaps a detachable keyboard that turns it from a tablet to a clamshell. And failing that, at least bluetooth keyboard support (good thing Apple already has a slim Bluetooth keyboard.) Also throw in some sort of synchronization of files with your regular Mac Windows PC, and an iSight camera with iChat. It’s Touch OS-based, but is designed to give almost desktop functionality. Any sort of specialized device for movies, digital music albums, home media centers, etc. is not enough- those are niche applications- solutions in search of a real customer base. Computers are Swiss knives, and they sell in the many millions. And this will be a really, really sharp Swiss knife (and a very thin and beautiful one as well.)

So now it does not fit in a pocket, but neither does a netbook or small notebook and those sell pretty well. And the hardware will run very well because even though its souped up compared to an iPod Touch or iPhone 3GS, it doesn’t have the overhead of a Windows or Mac OSX.

So basically, this is a device that does what netbooks are used for, but is not a netbook. The big thing here is price- Can they do something like this for under $600? Anything more and most people will just pick a real notebook/netbook computer. The new 32GB iPod Touch will probably be $299 or $349, so maybe they can intro a 16GB tablet for $449 and a 32GB version for $549 (perhaps the keyboard will be an extra add-on.) If they can come in at around those prices, they will sell a boatload. Especially if it looks thin and beautiful, which Apple does better than anyone (sorry about the non-user replaceable battery though.)

You might be able to buy a netbook for cheaper, but this device has been designed to be a huge improvement over the netbook experience (for 80-90% of netbook users), at around the same price point (and I say this as a general fan of netbooks.)