A 7" Kindle Fire was in the rumour mill Wednesday after a report surfaced that Amazon was coming out with a $99 budget Kindle tablet. Rumours suggested Amazon is offering a much cheaper tablet to compete with Google Nexus 7. However, Amazon has immediately denied this claim.

Kindle Fire HD reviews are generally positive. Those who are not fans of Amazon shopping, however, are not attracted to this Android tablet. "According to what we've heard, the $99 Kindle Fire HD will also still sport a TI processor like the rest of the lineup, and will have a 1280×800 resolution, like today's Kindle Fire HD 7″ does," TechCrunch reported.

The Kindle Fire 7" HD features a 1280 × 800 px screen resolution, for a pixel density of 216 PPI (pixels per inch). It is fueled by a dual-core 1.2 GHz TI OMAP4 4460, with 1GB of RAM. It is the ideal small tablet for Amazon shoppers who frequently download entertainment content.

The $99 Kindle Fire HD rumour was given weight by an earlier price-slash announcement from Amazon. The recent official price drop, however, was only for the 8.9" device.

"As we expand Kindle Fire HD 8.9" to Europe and Japan, we've been able to increase our production volumes and decrease our costs. Across our business at Amazon, whenever we are able to create cost efficiencies like this, we want to pass the savings along to our customers," Dave Limp,vice president, Amazon Kindle has earlier told the media.

In a response to The Verge, Amazon denied any further price drops. The company also hinted the $99 Kindle Fire HD rumour was nothing but exactly that - a rumour.

"It's not happening," an Amazon spokesperson told The Verge. "We are already at the lowest price points possible for that hardware."

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