The rumor mill has been on an overdrive with reports suggesting that Taiwan-based Acer is gearing up to add to its Iconia line-up of tablets, and has a 7-inch device in the pipeline.

The 7-inch tablet, given the moniker Acer Iconia B1, recently passed through the FCC, fueling speculations that a new device was in the offing.

Additionally, the GLBenchmark database gave a glimpse of the low-end specifications of the "Acer B1-A71." Now, per reports a DigiTimes report, reliable sources have let on that Acer will launch the Android-powered 7-inch tablet in Q1 2013, which will be priced at just $99.

"Acer will launch a 7-inch Android tablet for sale at only US$99 in the first quarter of 2013, according to Taiwan-based supply chain makers. The tablet will be equipped with a processor developed by MediaTek to cut costs, the sources said," reported DigiTimes.

According to leaks, the Acer Iconia B1 will have a 7-inch screen (1024 x 600 pixels resolution), a 1.2GHz processor, 512MB of RAM, 8GB of storage, microsSD card slot, and Android 4.1.2 Jelly Bean. Moreover, per the FCC filings, the tablet seems to have built-in cellular ability and a SIM card slot.

The DigiTimes report has also let on that ASUS, who was also rumored to launch a $99 tablet, has decided against it owing to its relationship with Google.

"Asustek Computer has also developed a 7-inch tablet for sale at US$99 but has decided not to launch it due to its of cooperation with Google on the Nexus 7, the sources claimed," reported DigiTimes.

With rumors rife that Google is also readying a cheaper Nexus 7 that will cost $99 and will release in Q1 2013 as well, it will be interesting to see how the consumer market shapes up in the race for dominion.

Whether the alleged Acer Iconia B1 will be able to give other 7-inch tablets a run for their money in 2013, remains to be seen.