Vanity publishing, it used to be called. It happened because the author of a book was not willing to go through the gauntlet of rejection and revision. I've seen so many self-published books in which the author was not well-served by the publishing outfit that was happy to take the money but not at all willing to provide editorial services to save the author from his or her self. That's the history.
But in recent years the big house publishers have been overwhelmed by the number of submissions of viable manuscripts. They can't publish them all. Worthy manuscripts are rejected and end up in boxes. Part of this dilemma has been solved by a whole raft of small presses emerging. These presses make beautiful, well-edited books. Authors accessing these presses are not self-publishing, but they are making a tactical decision to get the book out and in front of people, and to begin the next one. My book, Forty Martyrs, soon to be published by Burrow Press of Orlando, FL, has stories in it that are 25 years old, go back to 1986. The stories in the book have been cited in Best American Short Stories and the Pushcart Prize and have to be seen as worthy of print. One of the stories appeared in the Kenyon Review, one the New England Review. One of the happiest of developments with Burrow Press is that they are giving me the opportunity, over a year, to make the manuscript the very best it can be. With the help of Ryan Rivas of Burrow Press, I'm combing over the stories, I'm working to sequence the stories in a proper and defensible way, so that there is a "flow" to the narrative, without impeding each story's ability to stand alone. I'm working with Olive Kitteridge as a model, one of my favorite books ever. This is not vanity publishing. The principles of Burrow Press used to be the principles of the big houses, in the time of Hemingway and Fitzgerald. Regrettably, the big houses now are not run by book people. They are corporate, and they have to generate a profit for their stockholders. How many "blockbuster" biographies of Burt Reynolds and the Clintons do we need?
But there is a place for self-publishing. Authors who are well known format and proof their own work, make their own beautiful book, and put it on the market. They reap the profits straight away. Well known authors are not going to press with manuscripts that are not proofed and are not beautiful books. The big houses no longer market or fund book tours. The promise of publishing by a big house is, like many things in these times, receding. Self-publishing is a tactical option for a career author. It is not a newbie shortcut.