Ebooks are not subject to sale-or-return accounting; every sale is final. Ebooks never go out of print, so contract reversion terms are different. The retail price is typically lower but the sales channel has fewer middle-men so the royalty rate is higher. Production costs are, surprisingly to most people, nearly as high as for dead-tree books (ebooks still need editing and proofreading and marketing).
Mass market paperback sales are down around 50-70% in the USA. (In the UK the mass market channel disappeared in the early 1990s; all paperbacks are sold as trade books.) Ebooks are now up to 60% of gross sales, from 6% in 2008-09 and 0.6% in 2005.
Hardcover or trade paperback sales are, mostly, unaffected by ebook sales. These are premium products sold to people who like buying lumps of dead tree. They may dwindle over the coming decades but the hardcover market is still okay.
So ebooks are the new mass market paperbacks; easily distributed, cheap, disposable reading matter.
This is an excellent antidote to the ebooks-are-changing-everything-books-are-dead panic that's abroad in the land. Yes, there a changes afoot, but this stuff is always a lot more contingent and complicated than it looks at first glance.