As more multi-function tablets enter the marketplace, it makes sense that eReader devices with the sole purpose of reading electronic books would begin to drop off, but IDC is predicting that a substantial discount on black and white eReaders could keep the market going strong this holiday season.

In its latest report on tablets and eReaders, IDC reports that tablet shipments, to no one's surprise, grew at a hefty 88.9 percent year over year. IDC also wrote that while eReaders took a 9 percent seasonal dip, it's forecasting big things for the stand-alone devices this holiday season.

That's because IDC research director for mobile connected devices, Tom Mainelli is predicting that reader makers will cut prices in a big way as the holiday shopping season approaches. "We expect major vendors to offer their current-generation black-and-white eReaders for less than $100 by the holidays," Mainelli said.

You may recall that I've been calling for a $99 eReader for years as a way to stimulate the market. Of course, the market has done quite well in spite of the fact that mainstream eBook reader makers such as Sony, Amazon and Barnes & Noble have not gone that low yet.

But as the line between tablets and eBook readers grows ever dimmer, it becomes harder for stand-alone units to compete with these devices. And harder to decipher what's an eBook reader and what's a tablet. IDC's Mainelli says that the new Amazon tablet expected later this year will be more like the Nook Color than the iPad, meaning IDC will continue to count it as an eReader, rather than a tablet, further driving the numbers for the eReader part of the market--but is that fair?

Fair or not, it's clear that devices like the $139 Kindle fall squarely on the eBook reader side of the equation. It's black and white. It doesn't have a touch screen and its main purpose is to buy and read Amazon Kindle books.

If Amazon suddenly were to discount this device under $100, I'm with Mainelli. They would fly off the shelves in a similar fashion to the HP TouchPads when HP held its now infamous fire sale last month. These were originally $500 items, so it's not exactly the same, but there is a mental barrier that retailers break through when they drop the price for a device like this under $100, and I think that dynamic would be in play for Amazon, Barnes & Noble and Sony if they were to go there.

And the fact is that if one of them discounts the basic black and white eReader, then they all have to follow suit because who is going to spend more when one is available for that kind of discounted price?

One thing that all the manufacturers have to do is gear up for demand if this happens because the last thing they want is to have a run on the devices and then not have them available for the holiday shopping rush.

I'm still not necessarily convinced that stand-alone eReaders will survive in the long run, but if the black and white readers become low-cost commodity devices, they might continue to live on for some time, regardless of the availability of tablets that do so much more than read eBooks. - Ron