When you come out in favor of self-publishing, the first question people push back at you with is “If everyone can self-publish, how do I find the things worth reading?”
My answer: Walk in to any Barnes and Noble, Borders, indie book store. Pick the section that most interests you and start picking up books at random. From reading the first page and cover, how many of these would you actually be willing to pay for? I’ll bet you money that number is lower in reality than you’d guess it would be. Let’s be honest, a large number of books put out by big publishing aren’t of interest to you or me. It’s just the nature of a big selection, some will hit and most won’t.
So, given that reality – how do you find what you want to read today? In a future where most works are self-published, you’d do approximately that.
Update to an Addendum: Here is Michael Stackpole’s musings on self-publishing. Rock on, brother.