Microsoft set to shrink its Surface: Software giant plans 7 inch 'Xbox' tablet to take on the iPad mini

The Surface tablet was unveiled earlier this year to a lukewarm reception - Now Microsoft is believed to be developing a smaller version to take on Apple's iPad mini

Microsoft is developing a smaller version of its Surface tablet with a 7inch screen, it has been claimed.

The tablet is expected to go on sale later this year, and will go head to head with Apple's iPad Mini, Google's Nexus 7 and the Amazon Kindle Fire in the lucrative small tablet market.

It is hoped the devices could reverse the disappointing sales of the larger Surface tablet which Microsoft launched this year

'The software giant is developing a new lineup of its Surface tablets, including a 7-inch version expected to go into mass production later this year,', The Wall Street Journal said