Eoin Purcell
Buzz, Balls & Hype
Is running an absolutely brilliant three part series by Barry Eisler:
I’m not arguing that labels offer no value other than distribution, just that distribution has always been their *key* value, the one thing that only they could offer. They’ve lost that key value; the challenge now will be to find ways to replace it with something else — for example, some combination of imprimatur, branding, marketing, and other residual values. But because none of these values offers nearly the barrier to entry that distribution did, other players will move into what today is the labels’ exclusive domain. Not all labels will die, but even the survivors will lose clout and profitability.
For labels read publishers and then it might be worth panicking for a while. But most importantly read:
Eoin Purcell's Blog 
Eoin — why so gloomy, why anxious?
http://exacteditions.blogspot.com/2007/11/blockbusters-and-brands.html
It seems to me that everything is going the publisher’s way. Agents cant do what publishers do. Booksellers cant do the other bit either. So the value chain is up for grabs by the publisher. Mind you they will need to pay higher royalties — especially to Thom Yorke and Madonna when they next do books.