This morning on my commute to work, New York Times best selling thriller author Barry Eisler was interviewed about his turning down a half million dollar contract with a traditional publisher to go indie for his latest novel, The Detachment. He was later picked up by Amazon's publishing arm in what could be called a hybrid part traditional & part independent deal. More and more authors are going independent/self pub and doing well.
After hearing multiple interviews and a convention discussion panel with best selling fantasy author Tracy Hickman, I am seeing that the overhead, waste, legacy processes, and inefficiencies of the traditional publishers are hurting those publishers in this newer, faster, leaner electronic age. The relationship between writer and reader is closer as the middle men (and women) of agents, editors, and publishing houses fall away. Tracy is a big proponent of the artist going straight to his readers. They are the ones that the stories are for.
Will publishers go away altogether? No, I don't think so. Books still need good editing, layout, and cover design. But the publishers that succeed will be smaller, leaner, and more efficient than those that ruled the roost in decades past.