Amazon.com is driving down the price of books, by taking a loss on each one to build market share. An effort by the major publishers to regain control of prices fell afoul of the Justice Department in April 2012, when they were accused of anti-competitive practices.
Google is now an e-book retailer. According to the New York Times, five of the six major publishers have switched from a wholesale model to an agency model. In the agency model the publisher set the price, the retailer gets 30% of of sale price, and the publisher gets 70%. This compares with the wholesale model, where the retailer set the retail price and paid the publisher the wholesale price.
Google is roiling the book industry with a plan to publish out of print books online1 (Gleick 2008). In 2009 court challenges to Google's plan were still ongoing, in an attempt to avoid a monopoly of access to out of print works (Stone and Helft, 2009)2
In an 3/19/09 WSJ essay entitled "How the E-Book will Change the Way we Read and Write"3 (Johnson 2009), Steven Johnson argues that the e-book will revolutionize the way we consume books. Specific quotes will become popular as they are linked to. People will flit from one book to another instead of staying immersed.
Textbook publishers are now offering book rental (August 2009). The idea is to give authors some royalties and to compete with second-hand book sales.
Stephen Covey is bypassing traditional publishers by using an e-book publisher and publishing directly to Kindle5. He also self-publishes online, which is another way to cut out traditional publishers.
Amazon.com is moving into book publishing. Its Kindle e-book reader allows it to distribute books directly into millions of homes, and potentially do better deals for authors.