Amazon is going to release a tablet that is likely going to be under the "Kindle" banner. Now, I don't know what the actual specs of such a device is going to be like but we can venture a few educated guesses and speculate on the impacts of Amazon's move into the tablet market.
Hardware.First, I want to suggest that we might see an Android 3, Honeycomb, based Kindle. It's not a big stretch if you think about it. Honeycomb is the only version of the Android OS sanctioned by Google for tablet use And so far, they are almost all based on Nvidia's Tegra 2 chips with a 10" screen. There will be Kindle specific apps that are not found in the regular Android Marketplace. We can expect cloud services that are tied into Amazon's music, video, and store.
Beyond this, your guess is as good as mine. Perhaps, Amazon might have their own webapps like e-mails. Certainly, the digital music locker will be a main feature.
And since Amazon is going to be new a this, I expect it to partner up with a wireless provider or two. If true, I expect the partner to be AT&T. And who will built the Kindle tablet? My top suspect is Samsung. In fact, the Kindle tablet could be a partnership between Amazon and Samsung with the latter playing a bigger role than just the manufacturer.
We might see a 7" version. In fact, it's very likely this will be the case. Barnes and Noble's Nook Color is around the same size and costs only $250. Amazon will be competitive in this area.
Whether it'll be a 7" or 10" Kindle tablet, I would not be surprised if Amazon tries to keep the cost down with advertisements, similar to their back-and-white Kindle with "special offers".
I know this What we will not see is a hybrid e-ink and LCD screen.
So, what's your best guess?