CNET already has the answer, here: iPad Mini vs. Google Nexus 7 vs. Amazon Kindle Fire HD | iPad Atlas – CNET Reviews.
Short answer: Apple fans will get the Mini. People who are not fans or looking to save money will likely gravitate towards the other two.
My first thought is that this is going to grow the tablet market signifigantly, and all three companies will benefit in the short term.
My second thought is that Apple is just getting started, and subsequent Minis will get better and better. I can’t see why Google won’t follow suit.