[stcredzero]

If Amazon is the only firm, it will bear all the costs if fewer good books come out in the future.

What are you saying? That media always tends towards higher quality, especially after consolidation?

Therefore, it has an incentive to create an ecosystem that maximizes it's long term profit.

There's no reason why this would preclude vast oceans of swill produced by isolated independent artists, from which a few mega-hits arise from time to time. (App Stores?)

For example, think about fishing. If there are lots of fishing boats they will tend to overfish.

The problem here, is that in this discussion it seems that fish correspond to authors. I don't think that's correct. Authors of a given "species" aren't a partially fungible resource that is "killed" when utilized. (Unless the authorial landscape turns into a vast ocean of swill from which a few megahit one-hit wonders sometimes arise.)

Please cite just one historical example where a media monopoly increased the quality of authorship in its domain.