While our first tendency is to draw comfort from having our worst suspicions confirmed, there is a stronger tendency to explore the idea that while Naipaul and Middleton are fine authors, they do not appeal to every reader. Thus, when it comes to make business decisions (and one must recall that representing or publishing books is indeed a business decision), different criteria are used to judge work. . . .
But this is, of course, the very point of Times article. It does not claim that "the book industry has become incapable of making business decisions" (although one could certainly question the wisdom of many it does make). Obviously, the implication of this experiment (submitting chapters from books by V. S. Naipaul and Stanley Middleton to various publishers, only to have them rejected) is that the overriding imperative in contemporary publishing is to indeed apply "different criteria" than literary merit. Perhaps Naipaul and Middleton "do not appeal to every reader," but that their work manifests "literary talent" seems to me undeniable. The "book industry" and its apologists need to make up their minds: Either "literary talent" no longer matters and publishing any piece of dreck that comes along on the suspicion it might make money is now acceptable practice, or it does matter and the publishing world is doing a dreadful job of serving that talent.