According to Amazon’s site, a would-be author can:
Self-publish and distribute your book
Make your book available to customers on Amazon.com and your own eStore. Set your book’s list price and earn royalties. Upload completed book files or use our free tools to prepare your content for publication. On-demand production of your book means you’ll never worry about inventory or minimum orders.
This seems to eliminate a lot of cost from the traditional book publishing route. The key to success would seem to be having a good editor, as that is a function that can’t really be automated in any meaningful way.