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I don't see how it could be the be-all, end-all of ebook retailing, but it could be a major component for indies and the backlist.
New releases from major authors won't be interested. Publishers have shown a keen aversion to discounting their titles, but they might be willing to let go of some backlist. After all, with out of print paper books they make nothing from used bookstores and yard sales. They could put them in a subscription plan and make a buck or two. Once those royalty checks start coming in, they'll change their tune.
I think about how the movie studio fought home videotapes for so long, tooth and nail. Eventually they realized what a significant revenue stream they had in VHS tapes and changed their thinking. Publishers will do the same.
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