It's not all grim, says former Hachette boss Kevin Chapman whose new company, Upstart Press, is rising from Hachette's ashes.
He says what was happening here was the same as had happened in the US and Britain five years ago. An initial drop in physical sales levelled out. "I think we'll see a bounce in print sales."
He said small publishers were far more adaptable than big multinationals.
Author James Russell did not even approach a mainstream publisher with his first children's book, The Dragon Hunters.
Instead, he formed his own company, Dragon Brothers Books.
"No one is going to promote this book better than I am, so what's the benefit of having a publisher do it?"
He is now considering taking on more authors. His books have extra touches, such as thick covers. "They will endure longer. You can't beat a real book when you're lying in bed, reading to your child."
Craig Potton Publishing produced last year's NZ Post Book of the Year, New Zealand's Native Trees. Five per cent of New Zealand's books are printed by companies that operate only in this country.
Elworthy agreed that mass market fiction was the biggest candidate for epublishing. Coffee-table books were likely always to remain in print. "People with e-readers continue to buy physical books."
But, he said, "No (one) is rolling in the profits at the moment."