Is the bad news good news?

The publishing mailing lists over the last few days have had several doom-and-gloom posts about a report released by Bowker (the people who bring you Books in Print). In each case—maybe this is just me reading something into the posts that isn’t there—I get the feeling the person posting the link is passing on bad news to the publishing community.

But I wonder. Does the drop represent bad news in the sense of declining book buying and declining readership? Or does it represent good news in the sense of small publishers getting smarter about what titles to invest in? Could this just be the publishing equivalent of the dot-bomb, an industry shakeout in which people regain their common sense and drop the properties that had no prospects of success in the first place?

It would be interesting to see a statistic that somehow captured the change in profit in the various publishing segments Bowker tracks, rather than the change in number of titles.