The Times is going all out for this deal. I would have expected them to pick up the discontinued 8GB model, but no. They're offering the 32GB model in this bundle, which has a retail of £199.
But if that's not your thing, The Times also offers a paper/digital bundle for £6 a week (no tablet included, sorry) as well as a web only package for about half the price of the tablet bundle.
Barnes & Noble offered a similar bundle at the beginning of this year, where new Nook Tablet and Nook Color owners could get a discounted device when purchased alongside a subscription to People Magazine or The New York Times - after jumping through some hoops.