With all the hype around the Kindle Fire it’s easy to forget about the Nook Tablet. The other budget Android tablet is zipping along nicely according to industry watchdog Digitimes. The outlet, citing upstream component suppliers, is reporting that B&N has shipped (note: not sold) one million units since the Nook Tablet’s mid-November launch. Plus, due to strong initial sales, ol’ B&N is increasing its order countering earlier estimates that predicted demand for a B&N tablet would decrease.

The Amazon Fire might be the wunderkind of the Android world, but the Nook Tablet isn’t a slouch either. Both the Fire and Nook Tablet are built using the formula of the original Nook Color. By skinning Android with a much more consumer-friendly interface, Amazon and B&N successfully are successfully chipping away at the iPad’s mountain. A much lower price helps as well.

The Nook Tablet will never likely eclipse the Kindle Fire in retail sales volume. The Fire already has a massive lead. But the sub-iPad tablet market is largely untapped and the impressive initial sales numbers show consumers want a $200-ish tablet. For example, if this report is correct (it seems very likely), B&N shipped a million tablets in roughly a month while CE giant Asus is predicting to ship just 1.8 million tablets for all of 2011.

The iPad has effectively already won the first several rounds of the tablet war. But much like the PC battlefield, there is plenty of room for more than just one vendor. Barnes & Noble is officially a top player.