This looks like another case of those controlling the means of production and distribution primed for disruption. There's no shortage of "iTunes for Books" ideas out there, but imagine giving authors a means to distribute their work without a middleman taking quite so large a cut. Similar to what's happening in the music industry.

It wouldn't have to rely solely on digital distribution either… well-known authors or books that meritoriously rise above the rank and file could then be picked up by the remaining smart book publishers and given real print distribution for those who still like to show off their bookshelves. Sort of like people still buying vinyl even though they have the MP3s.