Let's not get ahead of ourselves here, while the price:product ratio of the N7 is great, lets not act like a $249-$299 7" "iPad Touch/Mini" wouldn't sell circles around the N7... I mean, the damn thing will have an apple logo on its back.
Well it's up to Google to get the Nex-7 into Bricks and Mortar stores and get them in front of the eyes of the public. What Apple is doing here is a direct response to the KINDLE, as the Nex-7 is a direct response to the Kindle. Even though the Kindle is powered by Android, it doesn't mean shyt if everyone is using the Amazon App Store and not the Google Play Store. From Apple's perspective, that $199 price backed by a well known and loved company like Amazon is what really left Apple shook.
If the 7 inch iPad doesn't START at $199 or lower, then Amazon definitely beat them at THIS game for the time being. Question is, as far as the mainstream is concerned, will Google be able to put themselves in the public eye and compete on that level, because we all know Google got specs on lock.