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I'm surprised that this "paper vs ebooks" debate is still going on, since I don't think that they necessarily compete with eachother, or at least that they will keep doing so for very long.
Right now ebooks are just books that are not on paper. Black and white text, and that's pretty much it. But already we got authors and publishers getting ideas about the really cool stuff they could do with the next generation of ebook readers (or well, even the current one if you count the iPad). Add animations, add a soundtrack, add interactivity - some even start thinking about new ways to think about the very concept of narration.
I truly believe that ebooks will quickly stray from their current mimicking of paper books into a new form, a new media that will be impossible to compare to good ol' books, just like you can't compare a book and a video game, or a book and a movie.
But could that just as easily mean that paper books will be abandonned because of their lack of multimedia functions? That could be, if one would only buy a book for its content - but we also buy an object, which can have its own proper qualities. I suspect that focusing on those object-qualities (high quality paper, beautiful illustrations and binding, etc.) will be the next step in paper book evolution, and will allow them to exist and persist.
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