Apple Newton 2 in the works?

AppleInsider thinks that Apple is developing a small tablet – or an ultra-mobile PC (UMPC) of some sort in a bid to succeed where the now defunct Apple Newton failed (miserably). Think of this new device as a bigger iPhone with DVD-resolution (720×480) that has more processing power and the iPhone touch interface.

It becomes more exciting: according to appleinsider, the device is scheduled to appear sometime in Q1 2008. The question is: few people seem to want a touch-screen UMPC. Is it just because Microsoft could not get it right with its Origami or because that format doesn’t actually provide added-value? Right now, the demand seems to be on a cheap, instant-boot, keyboard-equipped super small laptop. Let’s see if Apple can change the game.