I know this isn't books, but let's look at 2 examples of games that came out through community funding, either through something like Patreon were people make donations or something like Kickstarter.
A) Dwarf Fortress. It's an incredibly niche game where the creator has spent literally decades of his life working full-time towards the game. He has a vision for the game and he doesn't compromise. The community funding allowed him to do this. It realistically would not have been possible in the current system.
B) Pillars of Eternity 1 (and 2) were both great games that simply weren't getting funding to be made in the business world. Yet it was successful and both were very good games.
I'm not going to claim they are revolutionary or even that great. But I am going to say that without the process, they wouldn't have been developed. I also think that demand would work the same regardless of the system.
If somebody creates a book like The Jungle, it would become a success anyway and more people would fund the author through consistent or one-time donations.
Really, we've hit the point with technology that we simply don't need the middle men anymore. The creators themselves can work directly with the consumers. I don't see a reason to continue the current system besides inertia.