Like other bloated companies built around outmoded, pre-Internet paradigms, the big corporate publishing houses has been hit hard in the ongoing financial crisis. The online magazine Salon today posted a succinct summary of the implosion that narrows the industry’s problems down to this:

Thanks to conglomeration and corporate distribution models, some of publishing’s biggest houses were laid very low by the current stock market collapse. And scary holiday book sales figures compounded the industry’s woes, with recent news of a 20 percent drop in sales in October from last year’s book market. Even worse, Nielsen Book Scan reported a 6.6 percent drop in unit sales during early December. Not even the holiday season could bolster book sales.

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All these factors have produced an industry slowdown that will affect all writers for years to come.

In fact, this won’t affect “all” writers at all. Corporate publishing has always been about keeping most writers away from print. Not everyone who thinks he can write and wants to be a published author is actually worth reading, of course, but as the explosion of self-publishing and independent boutique publishers like Cosimo has proven, there are plenty of writers who could never get near the traditional corporate publishers whose books are well worth reading and publishing. (J.K. Rowling’s Harry Potter books, for example, were first published by boutique publisher Bloomsbury.)

What does Salon think will be the upshot of the shakeup?

As the corporate monoliths limp into 2009, a number of smaller, more independent houses could thrive during this recession. A few of those presses have structured themselves to avoid long-standing problems that got big publishing into this mess: high advances, long author lists and spiraling costs.

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Who will survive publishing’s Ice Age? Undoubtedly, the companies that can command developments in the impending digital book revolution. Early next year, Amazon will release the second generation of the popular Kindle, and the Sony e-Reader currently has more than 300,000 users….

Neelan Choksi, Lexcycle’s chief operating officer, agrees that the midlist will suffer in coming years. “There’s going to be less support for smaller writers in the traditional publishing model, in the big buildings in Manhattan,” he explained. “But self-publishing and digital books haven’t been considered. This upheaval will cause many authors to look at the alternatives more seriously.”

But as former book editor and industry watcher Tom Engelhardt notes:

[M]ore than 550 years after the first Gutenberg Bible appeared, the printed book, still an unsurpassed technology for delivering information and experience, isn’t leaving the scene soon. It’s always worth remembering that, when those first printed books began to circulate in Western Europe, the previous form, the illuminated, hand-copied manuscript, did not disappear, despite what you might imagine. It lasted at least another century as a high-end collectible, which was largely what it had long been anyway.

Salon and Engelhardt miss the middle ground between books published under the old-fashioned corporate model and electronic-only e-books: print-on-demand, as Cosimo publishes. Digital publishing includes POD, which eliminates the need to print books in advance — requiring a huge investment in both the books as well as the space needed to store them — without eliminating the visceral pleasure of reading a physical book.

We at Cosimo have always thought that POD represented the future of book publishing, and it seems the marketplace is bearing us out.