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When the Surface RT launched on Oct. 26, there was commentary that Microsoft was missing out on a major opportunity by not releasing a smaller-sized tablet as competitors Apple, Google and Amazon had done around the same time. Microsoft may be working to remedy that complaint, however, according to a new report.

The Wall Street Journal reports Microsoft is working on a 7-inch tablet, citing unnamed sources. According to the report, the move was made in reaction to the market shift, as consumers have rapidly adopted smaller-screened tablets from Microsoft's aforementioned competitors.

Last year, shortly after the launch of the Surface RT, a report claimed Microsoft is working on a 7-inch gaming tablet called "Xbox Surface." Leaked specifications that accompanied the report indicated the device would use a custom ARM processor and 5GB of high-bandwidth DDR3 RAM, which would be an improvement on the strategy used with Surface RT, which launched with a dated Tegra 3 ARM chip.

The report also claimed the tablet would run a custom version of the Windows kernel that would feature an interface emphasizing entertainment services such as games, music, movies and television shows. While the Xbox Surface is said to support certain standard tablet functions such as email, it was reportedly designed to emphasize Microsoft's expanding entertainment services.

No additional information has since been released about the Xbox Surface, however, as Microsoft reportedly built its own factory to build Surface tablets, possibly in an effort to halt information about new devices from leaking to the press.

Microsoft is rumored to be hosting an event for the next-generation Xbox gaming console's announcement on May 21.

Source: The Wall Street Journal