ZDNet is reporting that Apple is preparing to announce 17" iMacs at next weekis MACWORLD New York expo. The report suggests that Apple is looking to build sales momentum for the iMac, and quotes analysts who are doubtful that a 17" display could do so. From ZDNet:

The upgrade to a 17-inch liquid crystal display (LCD) comes as sales have all but stalled on existing 15-inch flat-panel iMacs. Apple unveiled the original flat-panel iMac, which suspends the monitor from a pivoting arm attached to a hemispherical base, during Januaryis MACWORLD Expo in San Francisco.

"Certainly, if youire going to do an all-in-one PC, both the computer technology and the screen technology have to be current," said NPDTechworld analyst Stephen Baker. "One of the reasons the original iMac was long in the tooth (in sales) was because it took them four years to get a 17-inch monitor out there."

Baker said that although itis an exciting upgrade, given that Apple started selling the flat-panel iMac only about six months ago, he doesnit think a 17-inch product "is going to help drive sales. The difference between a 15-inch and 17-inch display probably isnit enough to change the dynamic of whatis going on."

The report also says that Apple will not be releasing new, faster PowerMacs at the show, and will instead focus on reducing inventory of the units that has been building up. From the article:

In a surprising turnabout, Apple will not release faster Power Macs, as widely rumored on Mac enthusiast Web sites. The company instead will seek to trim down existing inventory, in part using a new promotion, announced Monday, sources said. Power Mac customers can save between $300 and $500 on a flat-panel monitor with the promotion, which expires in mid August.

Channel sources warned that Appleis inventory of Power Macs has been building in recent weeks, despite three sales promotions launched since April. The release of faster Power Macs in January and of Adobe Photoshop in April failed to increase sales as expected, in part because of the slow economy, say analysts.

"Itis probably true inventory is high right now," Duboise said. "Iive seen more aggressive promotions from Apple, and they donit generally do a lot of promoting as a general rule. That says to me they need to incite buying for their PCs and that thereis some inventory out there."

The company tentatively plans to release faster Power Macs some time after the promotion ends, as early as mid August, possibly loaded with Jaguar, sources said.

There is a lot more information on what Apple will reportedly be doing at MACWORLD in the full article. Join in the discussion on this topic in our forums.

TMO will be providing extensive coverage of the Expo from the Keynote and the show floor.