Apple has been absolutely dominating the tablet market for quite some time but now that an actual competitor may have started doing well Apple is starting to get concerned. The Kindle Fire from Amazon is meant to be a low cost competitor to the iPad and as a result it is expected to sell very well, because of this many analysts feel that a price drop on the iPad is in the very near future.
Whether Apple is going to drop the price of the iPad 2, or release the iPad 3 at a lower price is still unknown but for now nearly everyone agrees that some sort of price drop is in the works. Apple has always maintained a high price for the iPad and now that some real competition has started it only makes sense that they would do everything possible to remain on top of the market.