The Times pick up the story:
Amazon, which already controls about 60 percent of the e-book market, can take a loss on every book it sells to gain market share for its Kindle devices. When it has enough competitive advantage, it can dictate its own terms, something publishers say is beginning to happen.Because Amazon not only sells books but the device on which to read them, they could keep prices low enough that traditional publishers get put out of business or are forced to drastically cut back on the services they provide. What people don't realize is that the cost of a book has very little to do with the ink and paper (or bytes) that constitute its physical existence. The real cost is in the editorial and design oversight that goes into a book.
The process begins with an acquisitions editor--someone who goes out and finds the writer. This person may work with an author's idea or generate the idea herself and then find the author. In the case of both The Beer Bible and the Beer Tasting Toolkit, the ideas came from the publisher. This person shepherds the book through the contracting stage and gets the writer on his way, helping to shape the structure and concept.
Once the manuscript is completed, someone (or ones) edit the thing. This is huge. Having done a lot of internet writing, I can tell you that the stuff that comes from my fingers and straight to you is substantially inferior to that which gets a thrice-over by editors. Editing is an advanced professional skill (quite different from writing itself) and it makes a huge difference. If we end up in a self-published world, we'll have nothing but misshapen, incomplete works.
Finally, there's layout, design, and promotion. It's possible for self-published books to find an audience, but not damned likely. It's much harder for niche books that require elbow grease to get in front of the right readers. After The Beer Tasting Toolkit was complete, two nice gentlemen from Chronicle Books called to tell me what they were going to do to sell the book. They'd already had early success, finding buyers in the UK and Sweden. Oh, and they're taking care of the Swedish translation, too.
It's already very hard for writers to make enough money writing books to live, and Amazon driving prices down will make it even harder. If they manage to destroy the infrastructure supporting the publication of professional books--a job that requires a team, not just one writer--it won't be long before the effect will trickle down to the reader. A guy like Michael Jackson could not exist through self-publishing, and obviously, guys like Michael Jackson are very important to have around.
This isn't just theoretical. The toll has already begun. Publishers are having to cut way back on things like editors, fact-checkers, and publicists. Books are demonstrably less professional, less polished, than they were a generation ago. If Amazon gets its way, things are going to get a lot worse in the next decade. Let's hope that doesn't happen.