Here is quite a long and thorough article on how publishing is changing. I picked the bits I found most interesting about the present. . .
Indeed, the problem for readers is that regardless of which side you agree with in theory, in practice you probably love the idea of buying books for under $5.00 but hate the idea of having to sort through quite so much junk to find good books at that price.
. . . the pricing. . .
Books deliver three sorts of value: good writing, good stories (true or fictional) and social connection. By the last, I mean that reading is a social activity and we like to read what others are reading. So popular books are worth more to us than less popular books.
. . . and the future. . .
Publishers also need to manage their backlists more effectively. Hugh Howey points out that in fiction many of the top-sellers are not recently published novels. Publishers are used to pulling titles out of physical circulation after a few months and focusing their promotional efforts on new authors. However a rich back catalog, all made available in electronic format will allow publishers to respond more quickly to emerging market trends.
Read the article here.