Retina DisplayWhen the first iPad was released, many complained that it was just a big iPhone/iPod touch. Now, as one of the most desired devices in tech history, people are clamoring for features from the smaller devices be implemented in its larger brethren. Most notably, the Retina display.

Is it happening, is it not happening? According to Richard Shim, an analyst at DisplaySearch, production on the 2048×1536 displays is already underway, and there are three suppliers: Samsung, Sharp and LGD.

We’ve heard a number of rumors concerning the iPad 3’s display before, and although it’s difficult to determine which is right or wrong, one thing everyone seems to agree on is the challenges Apple and its manufacturers face when making a 10-inch-class QXGA screen in high volume.

I would imagine there would be concerns about [adequate] supply given the resolution of the display but you’ve got three different suppliers at this point. They should have enough to launch the product, Shim said.

Shim’s comments jive with an earlier report out of TechTrader saying that Apple has purchased $500M to $1b in equipment from Sharp to supply panels for iPads, iPhone and iTVs.

The iPad 2, for all of its engineering genius, slightly disappointed Retina-hungry consumers because of its unremarkable 1024×768 display. Shim said once the iPad 3 hits, the screen will not be AMOLED, rather, it will use IPS technology like other Apple products.

We could start seeing finished devices produced in December. And then being ready to be shipped in January. With volumes gearing up in February and March, he said.

Of course, now that the 7-inch Kindle Fire has hit with great consumer interest, Shim had a few words to share about Apple’s plans to compete in the diminutive tablet market. As of now, the Cupertino-based company is merely showing an interest and, if an mini-iPad does happen, could appear in the second half of 2012.

Would you rather have a smaller iPad, or do you like its current size? In addition to a Retina display, how would you change the device?