What does this device look like? From what the gossip says, it will come with its own dedicated controller and the titles available will be ones that Amazon already has on its current Android platform. Looks like Amazon's pretty serious about its Android devices, with new, upgraded Kindle Fires on the way soon.
Knowing Amazon's penchant for competitively-priced devices that are more about selling content than the actual hardware, this will likely tie in with their current ecosystem. Imagine a gaming console that also allows you easy access to Amazon's books, movies and apps.
Likely this will target families or the consumers who were attracted to the Kindle Fire in the first place - something that won't break the bank and yet provide a lot of entertainment value. Sounds like something to look forward to!