Is Amazon Taking Over the Book Business?

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If Amazon Encore pans out, what's to stop authors from signing directly with bookstores and cutting publishers out of the loop completely? U2 and Madonna don't have deals with record labels anymore; they did their deals with a concert promoter, LiveNation. That stuff that the labels used to do — production, promotion, distribution — it's just not that hard to DIY now or buy off the shelf. It's the same with publishing. Amazon could become the LiveNation of the book world, a literary ecosystem unto itself: agent, editor, publisher, printer and bookstore. It probably will.

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The Sky Isn't Falling
But it's a big leap from there to concluding that publishers are going to perish or that Amazon wants them to. It's true that Amazon plays hardball with them, but that's partly because the online-book world — unlike the real-life Amazon — isn't particularly biodiverse yet. If publishers aren't in a position to check Amazon directly, the market is, or it will be. There will be some painful scenes while we wait for that to happen, but already Google — a company that never met a loss leader it didn't like — has announced its intention to start selling e-books before the end of the year. Simon & Schuster has just announced a plan to sell digital copies of its books through the e-book website Scribd.com. The price? Twenty percent off the harcover price, which comes to a good deal more than $9.99. "Within the next six to nine months, there will be many new devices, some new platforms and formats and a number of big companies entering this field that don't currently have a presence," says Michael Cader, founder of Publishers Lunch, an e-newsletter for book-world insiders. (See 25 must-have travel gadgets.)

As for Amazon the publisher, it's hard to imagine it competing seriously with conventional publishers. Its DNA is just too alien. When Amazon uses its customer base to crowd-source editorial selection, it's doing something radically different from what regular publishers do. "This is a very different method of discovering books than the more classic publishing process," Grandinetti explains. "The robustness of Amazon customer data is a different view into what people are looking for in a book."

He's right. A different editorial method will engage a very different set of literary values. Imagine a world where publishing has two centers rather than one: a conventional literary center, governed by mainstream publishing — with its big names and fancy prizes and high-end art direction — and a new one where books rise to fame and prominence YouTube-style, in the rough and tumble of the great Web 2.0 mosh pit. The two centers will affect each other gravitationally and swap authors back and forth between them, but they're not likely to eat each other. With any luck, they'll energize each other.

Which is why the future of books won't be purely Amazonian. It's not an either/or future. It's both/and. It will have publishers and self-publishers and books and Kindles and probably other devices in it too. The rise of a new model doesn't require the death of the old one. In fairy-tale terms, Princess Alera won't have to choose between the politically expedient Steldor and the mysteriously alluring Narian. She can have them both and live happily ever after. Or if not happily, at least she'll have plenty to read.

Read about Jeff Bezos, TIME's person of the year 1999.

Read "Amazon Kindle Users Are Older Than You Think."