I agree. I also think that the damage is going to be more for current-android-tablet makers, such as Samsung, Acer, Asus, Viewsonic ..etc. More so to the ones who price their tablets above $400. Everyone's going to compare them to the Fire and say, "Why even consider anything when I can get this for half the price?".
Pretty safe to say, Amazon's tablet is going to beat all the other android-tablets.