Self Publishing's Impact On Small Publishers

Let's hearken back about two years ago when ereaders were starting to get more attention. I was one of those people who said,  "Yes, they will be popular." 
I envisioned people everywhere pulling out their readers on buses, in coffee shops in classrooms.  I imagined the morning paper on a reader lying on the table next to a steaming cup. I truly saw the American people embracing the newest technology.
What I didn't see coming was the huge swell of self-publishing authors because of ereaders...