With Chief Executive Steve Jobs out on medical leave, Apple Inc. hasn't announced a major new product this year. That has freed the rumor mill to churn about what new gadgets the company may be preparing to launch.

In the past few days, speculation has swirled that the Cupertino, Calif., company is developing a device with a touchscreen that could be as big as 10 inches, for release in the second half of the year.

Some people familiar with the matter say the device is a netbook, an inexpensive, shrunken notebook computer. Netbooks have been a growth segment for the PC market over the last year.

Other people close to Apple, however, say the device will be more like an iPod Touch with a bigger screen that will make it easier to watch movies, play videogames, read electronic books and surf the Internet.

These people say the multimedia device would be aimed at creating a new market that would challenge devices like Sony Corp.'s PlayStation Portable videogame player and Amazon Inc.'s Kindle e-book reader. They caution that the company's plans are still in the early stages and could change.

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