The big problem is of course Amazon who already has a large enough chunk of the market that they can sustain selling below cost far longer than anyone else. Once they win the battle with their business competitors they can ratchet up prices slowly or quickly. Either way, be prepared for a lot of instability in consumer ebook prices over the next year or more.
Read this British (ironic, I know) summary of the story here. Or read Shatkin's commentary for an in depth exploration of the ways this will affect the ebook market.
Neither situation is ideal for libraries. We could argue that we are a stabler market- except that we aren't because we havent built the infrastructure and in