With today’s Google I/O announcement of the Nexus Tablet, the battle of the 7 inch tablets with low prices is pretty much done. Or is it? Considering the Kindle Fire 2 may debut next month, we could see the Nexus Tablet having a fresh rival from the start of its lifespan.

One would expect Amazon to launch the new Kindle Fire this fall, like it did last year, when it debuted the device in September. A credible source quoted by CNET is saying that Amazon will unveil the new Kindle Fire this summer, with a July 31st target launch event date. Amazon was last rumored to be launching a fresh $199 7 inch tablet with a higher resolution of 1280 x 800 pixesls, according to Digitimes. It’s pretty strange to see Amazon keeping the form factor, since I would have expected them to launch something bigger, maybe in the range of 10 inches or 8 maybe.

While DigiTimes quotes upstream supply chain, they also mention that the current Kindle Fire could go through a price drop, reaching as low as $149. New e-ink Kindles are also supposedly in the marking, with integrated lighting and a close release date as well. Meanwhile, CNET’s sources say that the new Kindle Fire will have a camera, physical vvolume control buttons, something that lacked from the previous version, plus 8 GB of storage and no external storage.