Google and Asus' Nexus 7 tablet won us over quickly upon its release last year with its size, quality, and price, and while Google gave it a small upgrade in time for the holiday season, we're starting to hear rumblings about its replacement. "Sources with knowledge of the new product" have told Reuters that the new tablet will start shipping in July, exactly a year after the original Nexus 7, and that Asus will still be the manufacturer of choice. The new tablet could be introduced for the same $199 starting price as the current tablet, but the source also added that a $149 starting price could be possible.

The new version will bring several improvements over last year's model: it will make the screen's bezels slightly thinner to reduce its overall size, increase the resolution from the current tablet's 1280×800, and include a system-on-a-chip from Qualcomm rather than the current tablet's Nvidia SoC. The decision to go with the as-yet unspecified Qualcomm chip instead of Nvidia's next-generation Tegra 4 was made because of concerns with power consumption, according to Reuters' sources. We had previously heard rumors that the new Nexus 7 could have a 1080p screen, and while this is possible, keep in mind that this number comes from the notoriously unreliable DigiTimes—Reuters doesn't mention a specific resolution in its report.

We don't know how many Nexus 7 tablets Google has shipped, but its low asking price and stock Android software is helping it get some traction in a market that Apple (and, to a lesser extent, Amazon) have dominated. Analysts estimate that about 4.6 million Nexus 7 tablets were sold in the last half of 2012, and Google reportedly wants to bump that up to eight million with the new model.

If the new tablet starts shipping in July, we fully expect it to be revealed at this year's Google I/O in May as the original Nexus 7 was. We'll be on the ground at I/O and will be covering any and all new product announcements that come out of the conference.