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Rumor: $199 Google Play Tablet by Asus Will Have Tegra 3

Whether it's called Google Play or donning the Google Nexus brand, more rumors about a 7-inch "Google Experience Device" have emerged, this time with Nvidia's Tegra 3 quad-core SoC and maybe even a 10-inch brother. Asus will reportedly be at the helm of this device, packing it with Android 4.0 "Ice Cream Sandwich" and as expected, a $199 pricetag to combat Amazon's Kindle Fire.

This latest rumor stems from two different "industry sources" talking it up last week during Mobile World Congress. Echoing what we said last week, they confirm that Google sees Amazon as a threat in the Android tablet market. Typically this market is split into two retail models: the certified Android devices and the non-certified devices. The former includes Google's services like Gmail, Android Market and so on, whereas the second group does not, and generally aren't as popular or as lucrative as the Google-sanctioned devices.

But now we have Amazon's Kindle Fire, the best-selling Android tablet on the market. While this should be good news for Google, it really isn't, as the device resides within the non-certified group. That means Amazon has replaced Google's ecosystem with its own, thus Google gets nothing when apps are purchased via Amazon's Appstore or when movies are bought and streamed via Amazon Instant Video.

During Mobile World Congress, Android chief Andy Rubin hinted that Google has set its sights on the Kindle Fire and plans to release an official product to regain control over the Android tablet sector. "2012 is going to be the year that we double down and make sure we’re winning in that space," he said. "We’re going to do a better job at making people understand what ecosystem they’re buying into."

Google's secret weapon, the rumored 7-inch Android tablet, may be something similar to the Asus MeMo 370T revealed back in January at CES 2012. The device reportedly featured Nvidia's Tegra 3 SoC and a $249 price tag. There's speculation that the internal storage in Google's version will be less to knock the price down to $199, but Google may keep the current capacity just in spite and take the financial hit. The rumored 10-inch version will likely cost $299.

As for the name, that's still up in the air. Last week's report suggested Google Play after the company supposedly scooped up a slew of domain names. But there's also a good chance Google Play refers to an entertainment network of sorts that will encompass multiple devices with exclusive access to multimedia much like Amazon locks Instant Video playback to certain devices. The "Nexus" branding seems more likely given that Google has used it for its "Google Experience Device" smartphones.

Google's tablet is expected to go into production in April, followed by a retail release in June. If the tablet isn't actually rolled out to Google IO attendees on June 27th, then we expect to hear official news about the gadget during the convention at the very least.