Hal O'Brien

Why is it the retailers like Amazon and B&N coming out with Kindles and Nooks? Why isn't it the publishers?

As I understand it, the standard splits in publishing for the longest time have been 50% for the retailer, 40% for the publisher, 10% for the writer (of which 10% goes to their agent, so really 9% for the writer, 1% for the agent).

If you're a retailer who brings out an e-reader, that means you still have to deal with publishers, so the percentages shouldn't really change -- even if Amazon then charges only USD$9.99 for a "hardback" that's $24.99 in a cloth edition.

But if you're a publisher who brings out an e-reader, with a Kindle/iTunes-like "store" of your titles, that means you can cut the retailer out entirely. 90% of $9.99 turns out to still be less than 40% of $24.99 -- but not by much, it gives you lock-in over time, and it beats 40% of $9.99 all hollow.

Or, the nuclear option in the other direction: What if Amazon and B&N are thinking about becoming publishers themselves (and not just of public domain works a la Dover the way B&N has done for a while now)?

It seems to me one level of this ecosystem is about to become superfluous. Who? Am I missing something?

Edited to add: Urban myths don't constitute an explanation. Bertelsmann's sales alone annualize out at just shy of $21 billion, larger than either Amazon or B&N. Book sales have been holding steady since 2007 according not only to Bertelsmann's, Amazon's, and B&N's annual reports (and inside sources in publishing), but according to the US Census Bureau, who show only a 1.5% drop 2007-01 through 2009-10, annualized out. The broader economy has been having trouble during that time, as you may have heard. Here's Amazon's 2008 annual report; here's Barnes & Noble's. Unsurprisingly, the majority of their revenue does come from book sales.

Have some used book stores closed over that time? Yes. Have a great many dealers, including new ones, gone to ABEBooks, Alibris, etc. over the same time? Yes, again. While bricks and mortar stores may have decreased in number, I would be completely unsurprised if the total number of book dealers has increased. (If reputable numbers can be found, I'd welcome them.)