Update: Amazon came in at an even lower price point than anyone expected: $199. Wow. This thing is going to sell like hotcakes.

Previously:

We now have new details about the vaunted Amazon tablet. Here are the key points:

Priced at $249 ;

; 7 inch touchscreen;

New user interface based on Android with baked-in media stores;

Coming out this fall.

It's going to be a blockbuster.

Here's why:

People want a cheaper tablet and Amazon can give it. Surveys show tablets are still too expensive, and most people are waiting for tablets to get cheaper to buy them. Apple knows it and will probably lower prices as much as it can, but someone who can undercut Apple on price with a halfway-decent tablet will clean up.

Surveys show tablets are still too expensive, and most people are waiting for tablets to get cheaper to buy them. Apple knows it and will probably lower prices as much as it can, but someone who can undercut Apple on price with a halfway-decent tablet will clean up. Surveys also show people trust Amazon's brand for tablets.

Amazon has the biggest retail shop window in the world. The Kindle became a best-selling, category-defining consumer electronics product at least in part because it's on the frontpage of Amazon.com most every day.

The Kindle became a best-selling, category-defining consumer electronics product at least in part because it's on the frontpage of Amazon.com most every day. Amazon has a media ecosystem that can compete with Apple's. Possibly the most interesting rumor about the Amazon tablet is the idea that it could come with free Amazon Prime, Amazon's service which not only includes free shipping on goods, but also streaming media. Amazon also has an app store, a well-regarded MP3 store and, of course, the Kindle store.

Possibly the most interesting rumor about the Amazon tablet is the idea that it could come with free Amazon Prime, Amazon's service which not only includes free shipping on goods, but also streaming media. Amazon also has an app store, a well-regarded MP3 store and, of course, the Kindle store. Media is going to HTML5 faster than we thought. This is good for non-iPad tablets. We wrote about that last week.

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