The next-generation 9.7-inch iPad is expected to use the same touch sensors as the iPad mini's thin-film DITO (G/F2) touch panel structure. This means that Apple will be looking mostly to Nissha to supply the touch sensors for both devices as the Japan-based firm is a leading provider of the technology, the sources said.

Nissha currently has an annual production capacity for 60 million 9.7-inch equivalent touch sensors, said the sources. Approximately 33 million iPads are expected to be shipped during 2013 while shipments of the 7.9-inch iPad mini are expected to reach 55 million units, indicating that Nissha's production capacity of the touch sensors will be below Apple's expected demand for the two tablet products.

However, the sources stated that Nissha has plans to expand its production capacity by 30% before the end of the first quarter of 2013.

Despite the increase, DigiTimes notes that another conflict may arise in that the two iPad designs (Standard and mini) could cause both of Apple's supply chains to be fiercely competing with each other for Apple's orders.

The supply chains, which will not be entirely the same even though similar technology is expected to be used in the two types of tablets, may have to scramble for the thin-film touch sensor technology during the second quarter of the year in order to meet shipment demand in the following quarter.

The sources eluded that this type of internal supply chain conflict may cause one of the devices to lack in shipments upon their release.

DigiTimes adds that the adjustment by Apple is also likely to affect its supply chains. Panel providers for the iPad such as LG Display and backlighting unit (BLU) providers such as Radiant Opto-Electronics are expected to take a hit in shipments and possibly revenues, while iPad mini panel suppliers such as AU Optronics (AUO) and affiliated BLU providers such as Coretronic are expected to see the opposite during 2013.

With Apple's iPad mini reportedly outselling their 9.7 model by a factor of 3:1 or 4:1, it may work to Apple's advantage to emphasize iPad mini production so as to be able to meet demand. On another note, we hope that our friends at Ferrari secured enough of the iPad minis to support their latest promotion.

DigiTimes