Why Online Retailers Will Squeeze Out Publishers In The Book Business

[Commentary] A decade ago, Napster made it clear that the music industry was going digital, forcing record labels to scramble to survive. Today, a similar phenomenon is playing out in the book world – and this time, it’s publishers that are on the defensive.

As e-book sales rise, the big question is: do authors really need publishers anymore? Large publishers have to leverage their uniquely deep knowledge of books to master meta data that in the search-driven online world replaces the book cover as the critical discovery vehicle for books. But Shatz doesn't think publishers will figure all this out in time, which is why retailers will dominate the customer relationships in the future. They can amass enough of a consumer base that they can market a book to hundreds of millions of consumers and, more importantly, get enough of those consumers to buy the book.

[Matt Shatz is currently Head of Strategic Content Relations for Nokia]