I've touched on this before, but while people may not want to buy single chapters of books, they do want to read things that aren't book length. I think we'll see more literature in the novella/short-story/long magazine article range as publishers and authors attempt to fill that gap.More than we're aware, our notion of what constitutes a published work has been constrained by the economics of publishing, printing and distribution. Books, magazines and newspapers came to predominate because selling shorter forms was prohibitively expensive -- especially on the distribution front.
Sound familiar? It is. For decades, albums dominated the music market. Although there were some aesthetic benefits, they were secondary. It was just the most cost-effective business model -- until it wasn't. Just as much of the music market shifted from albums to single tracks, with the advent of electronic distribution, there may be a huge market out there for easily downloadable short fiction and nonfiction.
Kottke's right: "When an industry changes dramatically, the future belongs to the nimble."