Apple has just announced the third generation of the iPod touch at their “It’s only Rock and Roll” event this morning. The first order of business is that the 8GB iPod touch is now just $199. In addition, the 32GB model will now sell for $299, and the newly announced 64GB model (which I am drooling over) will sell for $399. The iPod touch has hit that magical $199 price point, and based on that, we think Apple can expect sales to shoot even higher.

The new touches also have iPhone 3GS innards, since they support OpenGL 2.0, which means games will look and perform even better.

The negative? No camera. That is the one thing we were hoping to see added to the touch, and it didn’t happen. Oh well, there’s always next year.