The Kindle is on fire. Sorta.

The rumours of the iPad's death are premature, but not too ridiculous.

It's true that the iPad is still cock of the walk, but other tablet makers have been getting a little uppity lately. And I think it's because everyone sat up and took notice when the HP tablet poured gasoline all over itself, lit the match, and discontinued itself. But not before causing near hysteria as buyers flocked to the stores to pick up massively discounted tablets.

The lesson? Everyone wants an iPad. But, if they don't have $600 burning a hole in their pocket - and how does, these days - they want a table so bad that they are willing to buy a discounted, discontinued product if it's cheap.

It didn't take long for iPad competitors to fall in line. RIM dropped the price of their Playbook to a few hundred dollars and, suddenly, vendors couldn't keep them on the shelves.

And now,  Best Buy reports that their top selling tablet is no longer an iPad, but the Kindle Fire. No doubt, this is because the Kindle is selling for half the price of the iPad.

Finally, tablet makers realise that they can't compete with the iPad, head to head. Who wants a Playbook or a Galaxy or a Kindle if they can get an iPad for the same price? (Hint: No one)

But there's a second tier of tablets, the lower priced models. My guess: we're about to see a whole new ecosystem of low cost tablets, ranging from a high of $300 down to as low as $150. This is embarrassing news for HP, who might have been able to make a go of things if they didn't so fabulously flame out. And it's great news for RIM, who might actually get some traction with a lower priced tablet.

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