Books are not dead, and for that matter neither are bookstores.  Perhaps big book chain stores are going to take a hit, but the digital age has done that kind of damage to most companies that have their business model based in the style that came before the digital age and have not adapted.  (How many people over the age of maybe 15 have actually experienced a Video Arcade for instance?  They died out with the invention and mass production of the cheap and effective home console.)  However, the death of these kinds of chains does allow for a growth of the small time independent stores that can work off of local clientele and an atmosphere of "buy local" (not to mention the ever self-indulgent hipster market).  The model clearly exists just by looking at how music changed as a result of Napster back in the 1990s.