Asus CEO Jonney Shih says the company plans to phase out its 7 inch netbooks, but is not ready to eliminate its 8.9 inch models just yet despite recent reports suggesting that the company would be focusing almost exclusively on models with 10 inch screens.

Speaking at CeBIT in Germany, Shih said that customers seem to prefer computers with larger screens and keyboards than those found on 7 inchnetbooks. But he says the 8.9 inch machines could still be attractive children, emerging markets, and telecommunications providers. To me, that sounds like he’s admitting that you won’t see the 8.9 inch models available through general retail outlets much longer, but I could be wrong. On the other hand, we have seen plenty of stores offering deep, deep discounts on 8.9 inch Asus netbooks like the Eee PC 901 recently.