Microsoft reportedly has called off a plan to mass produce its small-size Surface Mini tablet because of fierce compeition in the small-size tablet segment, as well as negative responses from its brand vendor clients, according to sources from the upstream supply chain.

Microsoft has finished developing the Surface Mini and also completed the product tests; however, mass production did not start as scheduled in May, the sources said, adding Microsoft still paid the costs for the module development and production equipment, the sources said.

The Surface Mini reportedly features a 7.5- to 8-inch display, an ARM processors, OneNote and Windows RT 8.1 operating system, the sources noted.

Compared to other small-size tablets in the market, the Surface Mini's specifications have nothing in particular to boost its competitiveness and therefore Microsoft has decided to postpone the tablet's launch and may not even launch it to the market at all, the sources said.

Brand vendors' small-size tablets are now mostly priced below US$100, while white-box models are only around US$50. Apple's upcoming 4.7- and 5.5-inch iPhones, which are expected to undermine demand for 7-inch tablets, are another key factor that prompted Microsoft to change its plan for Surface Mini, the sources added.