The eBook reader age could be ending

Tablets like iPad making it tough on them

As eBook reader device sales plummet in the face of competing tablets, we could be witnessing the end of the eBook reader age.

iSuppli reported that eReader shipments are expected to plunge 36 percent this year with total units dropping from last year's 23.2 million units down to 14.9 million. These figures are probably not surprising as we see growing competition from increasingly cheaper multi-function tablet devices.

iSuppli is predicting that by next year, just 10.1 million units will be sold and the numbers are expected to continue to drop beyond that. 

It's not a tough prediction to make actually. The argument for eReaders has always been they do one thing and they do it well, but that one thing may not be enough for consumers moving forward. With cheaper Android tablets flooding the market, it's hard for stand-alone eReaders to compete.

And iSuppli says tablets are stepping up in a big way with 120 million tablets shipped this year and of course, those numbers are projected to rise in the coming years (for whatever those types of projections are worth).

It's interesting that in the same week that iSuppli released these figures, Barnes and Noble announced it was dropping the price of the Nook Simple Touch from $99 to $79. That's a substantial drop in the middle of holiday gift giving season and could be enough to motivate some folks to fork over the money for one, but probably not enough to alter the number substantially.

We were bound to see the commoditization of the eBook reader. If iSuppli is right and sales continue to drop, then we are likely to see prices drop even further. At some point, it will probably be worthwhile for (NASDAQ: AMZN) and Barnes and Noble to simply give away the readers or sell them at very low prices in exchange for a yearly subscription package not unlike Amazon Prime, which offers customers a bunch of benefits in exchange for a yearly fee. 

So far, Prime doesn't include a free or low-cost device, but I could see Amazon making this move at some point in the future to drive interest in their devices and more importantly in the content that they sell.

One thing is clear, as the market tightens, prices are sure to drop further and eBook readers could be very affordable options for schools and families.

For more information:
- see the iSuppli press release with all of their figures and predictions for the eReader market.

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