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I think we're in a period right now where the most adventurous of the mid-list authors are searching out business models that will jump around the contracts that the traditional publishers are offering. As more of them start to succeed and prove that they can make good money without the aid of Macmillan or Penguin and they get to retain creative control of their work, others will follow. I had a talk with one the other day who told me she is most looking forward to just being able to get book cover that actually complements the story inside rather than just the "bare chested man of the month" her Publisher comes up with.
So in that sense, yes the Publishing business model is in jeopardy. Just like with any other industry, the ones who are more likely to remain around will be the ones who manage not to begin every conversation with "But this is the way we've always done business!"
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