Well, the low-end N7 has a $152 bill of materials and has some fairly high-end hardware, so putting in slightly lower-end hardware (dual core chip, 1,024 x 600 display etc) can get the tablet close to $99.
The other thing to note is that Google can probably afford to lose a bit of money on these, since it'll only take a few months (say, q2 '13) for them to really drop to $99. Seems like having the only $99 this holiday season is worth a couple of hundred millions (think of it as a huge advertising campaign).
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Well, the low-end N7 has a $152 bill of materials and has some fairly high-end hardware, so putting in slightly lower-end hardware (dual core chip, 1,024 x 600 display etc) can get the tablet close to $99.
The other thing to note is that Google can probably afford to lose a bit of money on these, since it'll only take a few months (say, q2 '13) for them to really drop to $99. Seems like having the only $99 this holiday season is worth a couple of hundred millions (think of it as a huge advertising campaign).