Amazon’s upcoming 7-inch tablet computer, known as Amazon Kindle, is rumored to be available for $250 and will be backlit. The cost is half the price of an entry-level iPad.

MG Seigler of TechCrunch claimed that he was one of the first to use and test the long-rumored tablet computer form Amazon and wrote about it in his blog.

The writer reported that the tablet will arrive at the end of November and will sport a full-colored capacitive touch screen. The device is expected to run a version of Android operating system that will be customized by Amazon.

“How do I know all of this? Well, not only have I heard about the device, I’ve seen it and used it. And I’m happy to report that it’s going to be a big deal. Huge, potentially,” Seigler wrote in his blog.

The device’s main screen will come with a different type of interface that will display the contents that will be available with the device. The device’s music player is Amazon's Cloud Player, the e-Reader is a Kindle app, while the movie player is the company's Instant Video player.

“Earlier this week, reports suggested that a 7-inch Amazon tablet could be released in October, with a larger, 10-inch version to follow next year. That’s somewhat accurate. As of right now, Amazon’s only definitive plan is to release this 7-inch Kindle tablet and they’re targeting the end of November to do that,” Seigler added. “The version I saw was a DVT (Design Verification Testing) unit. These have started floating around the company. It’s ready, they’re just tweaking the software now. If it’s not in production yet, it will be very soon.”

The Amazon Kindle will arrive with only 6GB of storage and will feature Amazon's own app store. There are no words about Google’s Android Market, however.

Seigler also said that Amazon, whose tablet looks similar to that of BlackBerry PlayBook, did not work with Google on the device, according to a LA Times report.

A previous Forrester Research said that Amazon could sell 3 million to 5 million units before the year’s end and is all the rumors and speculations are true then the Amazon Kindle could be a real headache for the iPad.