In theory, authors should be OK, though the situation has far from shaken out. Write a book that sells 55,000 copies (my best result, for "The Progress Paradox," published 2003) and the royalty would be about $2 per hardback and $1 per paperback. Electronic books sell for half the price of printed books, thus half the royalty, and all the price pressure is downward. Suppose electronic formats enable authors to sell far more copies, with lower royalties per sale. There's no reason an author could not have about the same income, but with a far larger readership while offering better deals to readers. This version of the electronic book market has not quite developed yet -- the Big Worry is that total sales won't change much, cutting author's royalties in half. But a thriving electronic book market is not a fantasy either. Early on, mobile phone markets were troubled. Eventually everyone was happy with huge sales volumes at low prices.
But there is an aspect of electronic books that worries me deeply: their impermanence. When a book is printed the author must always live with any factual errors or dumb sentences -- trust me, I have plenty of experience -- but no government agency or corporation can make anything controversial in the book disappear. Electronic books are easily changed, and this can be done remotely. If I broke into your house and ripped pages out of a controversial book, you'd know it. If I sent an electronic command to make pages disappear, you might not realize that for years: then when you did, you might not be able to prove they'd ever been there.
A few years ago, Amazon remotely deleted from Kindles several books that Amazon discovered it did not have the legal right to sell. That the books deleted were works of George Orwell made the whole thing seem amusing. No one should have been amused. Police have no idea what printed books are on your bookshelf, would need a search warrant to find out, and you'd know when they entered the door. Electronic books can be tracked, altered or deleted remotely, without your knowledge that it's happening.
Many authors I know are fretting that electronic alteration means a book will never really be finished. Write a book about Topic X, it's six months from when the author signs off on the galley pages till when the book is in stores. Today, readers understand that with printed books, whatever happened regarding Topic X in recent months cannot possibly be in the text. With electronic books, readers may come to expect current-events updates. Maybe they'll expect updates daily. A book will never be finished.