Will Microsoft Unveil Its iPad Mini-Killer On May 20?

Microsoft MSFT is expected to unveil its first seven-inch tablet at an event later this month.

Rumors claim that the device will contain a 7.5-inch display with a resolution of 1,400 x 1,050 pixels. That would make the screen smaller and the resolution lower than the iPad Mini with Retina Display, which offers a 2,048 x 1,536 display with 326 pixels per inch.

That hardly sounds like an iPad Mini-killer, but it is also just a rumor. Microsoft has yet to confirm the specs for its mini Surface. In fact, the company has yet to announce that it will actually release a smaller tablet.

However, the Windows maker has revealed that it will host an event on May 20. No one knows what the event is for, but many assume that the Surface Mini will take center stage.

"I think it's pretty telegraphed that [the event] is for the mini Surface," FBR Capital Markets analyst Daniel H. Ives told Benzinga. "I think it's all part of the [Satya] Nadella era to make Microsoft not just a transparent company, but a company that needs to go after trends."

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That said, Ives doesn't expect the Surface Mini (or whatever it may be called) to significantly move the needle in terms of tablet sales.

"That continues to be an uphill battle, especially against the likes of Samsung and Apple," Ives added. "I think Office for iPad speaks to that diversification strategy in terms of making sure that they're continuing to sort of hedge their bets as they think about their tablet market. And I think, look, this is really one of Nadella's main challenges. They continue to be miles behind the competitors. And tablet and mobile really needs to turn around for Microsoft to start to re-accelerate growth outside of PCs."

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With regard to the sales challenges faced by all manufacturers, Ives said that Microsoft isn't necessarily pushing Surface from a revenue perspective.

"It's more for brand awareness," he said. "And it's all starting to set the stage for more of a cloud-centric platform. In other words, Microsoft right now is really going after mindshare. The Surface ship has already left the port. They've already started to go down this path. I think to some extent they'd rather go full-steam ahead on Surface -- in terms of a diversified tablet strategy -- rather than just mailing it in."

Ives doesn't expect a smaller Surface to change Microsoft's tablet strategy.

"But I think, even though it's a me-too product, they need to go down this product path to make sure that they can check every box from tablets to PCs to smartphones," Ives concluded.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.