Joe Konrath has a great
blog post breaking down the current situation from the point of view of an author (lots of authors are blogging on this, of course). What I found especially interesting was the summary he receives from Amazon listing his book sales, all of which is extra money since his publisher wasn't interested in the out-of-print books. With Amazon DTP as his publisher, he earns almost as much on a $2.99 Kindle book as he does on a $24.95 hardcover. At current sales rates, when the new Amazon 70/30 split comes into effect in June, he figures he'll be grossing 40K per year, on titles his publisher didn't want. That's not too shabby.
With the history of the music and movie industries to study, the story of how the publishers can get themselves into this sort of a mess would probably make for good reading
