Is Amazon eating the lunch of book publishers?

The online retail giant, Amazon, isn't sitting still. Like the massive river basin the company is named after, the company is continually developing new product lines. Lately, with the Kindle marketplace, they are now eating into the business territory currently occupied by traditional publishing houses.

The Kindle electronic book reader has opened the doors to a whoever new power structure in book publishing. Rather than let the book publishers hold the reins of being the conduit of bringing books to market, Amazon can now do the whole thing. Anybody with a book, in the proper electronic book format, and with an ISBN number, can upload their book to Amazon to sell it electronically to Kindle owners. This completely bypasses the traditional book publishers and threatens their existence similarly to the way news publishing industry recently went through major upheavals.

The GigaOM article linked below details Amazons quiet process the last year of assembling this threat upon the book publishing industry. They began by opening the Kindle bookstore to anyone. This launched a small industry of publishing houses who assist authors to get into not just the Kindle marketplace, but for other electronic book markets. However Amazon has now put together their own book imprints, and have made distribution deals with several major authors.

The question would be - what threat is this to traditional publishers?

Would the customer base totally eschew paper books? Amazons power here is that they control a highly popular electronic book distribution channel. It isn't the only e-book market but it's perhaps the most popular. But does it compete with paper books? That is will the customers ever completely switch from buying paper books to e-books?

Would authors completely eschew traditional book publishers? They have existing patterns where authors and publishers work together to get books onto the market. Perhaps Amazon can offer authors a better deal than regular publishers, but to equal the existing system Amazon would have to develop expertise in editoring, working with authors to make great books, book design, and marketing. Publishers don't just print ink on paper to distribute through warehouses. Amazon can recreate it all but it will take time and money, both of which Amazon appears to have.

Will Amazon have exclusive control over book sales? This would be a thing to be properly afraid of, Amazon being the only market for authors to sell books. That would give Amazon a strangle-hold over the ideas our society tells itself through books. Fortunately there are plenty of other e-book markets for authors to sell in. Today. Who knows what the future will hold? The iPad I'm writing this on has book reader apps from four e-book marketplaces, but I primarily use the Kindle market.

Will the existing format of books remain the format used as electronic books develop in future years? Current e-book formats mimic the chapter/page structure of printed books. But as we develop electronic books should that remain as the organization structure?