Tablet market. The pricing war has started, where would it end?

Recently, Apple had just dropped the price point for Ipad2 by about 8% across all range of product.
£31 off £399 for wifi 16gb version, for example.

Is it because of the pressure from Motorola, who release the faster xoom 2 at below Ipad2 previous pricepoint?
£380 for wifi 16gb version.

Or the lower price point of older version(£321), Motorola xoom wifi 32gb,
which have comparable performance for ipad2, but double storage and expandable storage size?

Or, just a hint that ipad 3 is coming?