All is not well in the e-book market. Amazon and Google have each scaled back some e-book programs in the past week because business was weaker than expected. Both e-book sellers are having trouble doing business with publishers.

Amazon has pulled more than 4,000 books from its e-shelves after publishers wouldn’t budge for lower prices. Google is cutting off partners in its e-book affiliates program because sales referrals are too low to be worthwhile.

What’s going on here? E-book sales passed print in all trade categories last year, and e-book library lending is huge, but print still brings in more revenue for publishers. The problem is that consumers expect e-books to be cheaper, so publishers can’t charge as much for them as they might like. In other words, it’s a problem of business models, not of demand.

Meanwhile, Amazon’s profits are sagging, and Google Books trails far behind in terms of sales. They’re both getting tired of the middlemen, i.e. the publishers., and the squeeze they put on e-book sales.

Amazon is not shy about its efforts to get authors comfortable with self-publishing of e-books. Meanwhile, when publishing houses can’t meet its price expectations, Amazon pulls the plug on their books. Google’s affiliate program for e-books gave partners a better deal than Amazon’s affiliate links, but it’s cutting off the partners who can’t perform.

The author and the reader are hamstrung by the presence of not just one but two middlemen. Something’s got to give.

Inevitably, it will. It will be the publishers.

It’s getting amazinglyeasy for authors to publish their own books, and Amazon, Apple and Google are all working on ways to let authors expand the idea of the e-book itself. Amazon is poised for a big Kindle push in Brazil. There’s no question that the future of the book business is in the hands of these tech companies, not the publishers who can’t keep up.

See also: Books Continue to Evolve – Check Out E.O. Wilson’s ‘Life on Earth’ iBook

UPDATE 7:44 p.m.: RWW tipster Porter Anderson just passed along the news that Google has changed its mind and will now reinstate its independent affiliate publishers:

From Publishers Weekly:

“After notifying some independent bookseller Google eBook affiliates late last week that they will be removed from the program as of March 15 and their links deactivated, Google is now working to reinstate all indie affiliates. A Google spokesperson told PW that the company expects to add back those affected soon. She suggests that booksellers who sent e-mails but haven’t heard back yet recontact Google.”

Once we figure out why Google changed its tune, we’ll let you know.

Do you read e-books? Which store(s) and device(s) do you use?