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The default keyboard on the Nexus 7 is similar to an early version of Swype, but Swype is still evolving and ahead of the pack. Basically you just drag a trail over the keyboard and Swype will predict the word you want from the context. Is it wrong sometimes? sure. But it is eerily accurate almost all the time.

Other than a full-sized physical keyboard (I'm a touch typist), for me, the only thing faster is speech recognition - oh, and it does that too using Dragon's engine.