BY James Arnold BBC News Online business reporter

Tot up the paperbacks on the 7.38 to Waterloo, and it might seem that the book business is in clover.

The humble book, until recently seen as doomed by digital technology, has never been more visible, more desirable or - its proponents gush - more sexy.

A string of publishing phenomena, from teenage wizards to celebrity chefs, have pushed up sales for some titles into the stratosphere, and promise to introduce the joy of reading to an ever-wider public.

UK fiction bestsellers, 2001

Harry Potter and the Goblet of Fire JK Rowling 948,425 copies Harry Potter and the Chamber of Secrets JK Rowling 896,897 Harry Potter and the Philosopher's Stone JK Rowling 885,203 Harry Potter and the Prisoner of Azkaban JK Rowling 819,371 Bridget Jones's Diary Helen Fielding 534,542 White Teeth Zadie Smith 506,608 Man and Boy Tony Parsons 479,984 Fantastic Beasts and Where to Find Them Comic Relief 457,123 The Brethren John Grisham 454,386 Quidditch through the Ages Comic Relief 440,671 Source and copyright: BookTrack

But this World Book Day, which falls on Thursday, may not provide unanimous cheer.

The intensifying search for blockbuster bestsellers, many fear, is driving down standards, chasing out competition, and concentrating profits in the hands of a very few firms.

Book billionaires

Some of the industry's numbers certainly look impressive.

The British consumer book market was worth about �2.2bn last year, says Steve Bohme of research firm Book Marketing Limited (BML), representing year-on-year sales growth of about 6%.

"The big bestsellers are all selling in much higher quantities than books ever did before," says Nicholas Clee, editor of the Bookseller, a trade magazine.

The book sector, along with furniture and grocery, is the main driver of retail sales growth at present, according to a recent survey from the Confederation for British Industry.

Books can be intimidating...

And this is starting to pay dividends for some.

Penguin, Britain's biggest publisher and an arm of the Pearson media empire, recently announced a 6% increase in profits.

And WH Smith, the country's biggest book retailer, has said it will create 3,000 jobs in a wave of store openings.

More pies than Proust

But the figures do not bear too close a scrutiny.

The value of the market may be rising, but unit sales have barely increased, and indeed have rarely grown by more than 2% annually over the past half-dozen years.

... and some people are too busy to read

The overall sales figure of �2.2bn may look impressive, but is less than half the amount Britons spend on pub food every year, and only twice what they spend at beauty parlours.

In some areas, sales have collapsed - notably for travel titles, and the sort of reference books that the internet is ideally placed to supersede.

The combination of flat overall sales, combined with unprecedented demand in a few key areas - notably children's books, homes and gardens, cookery and biographies - has inevitably led to a dramatic concentration of money and influence in the industry.

Top authors and certain celebrities, known in industry jargon as the "front list", can now command fees way in excess of the pack.

"It's death to be on the mid-list," says Mr Clee.

Chains lock up the market

It has also concentrated enormous power in the hands of a few key retailers, the chain "multiples" which now account for at least half of retail sales.

UK non-fiction bestsellers, 2001

A Child called 'It' Dave Pelzer 596,342 copies Happy Days with the Naked Chef Jamie Oliver 528,615 Billy Pamela Stephenson 396,894 McCarthy's Bar Pete McCarthy 306,643 Guinness World Records 2002 304,835 Down Under Bill Bryson 272,164 Dr Atkins' New Diet Revolution Robert Atkins 268,394 Somebody Someday Robbie Williams 263,942 Highway Code 252,842 Bad Blood Lorna Sage 247,813 Source and copyright: BookTrack

"If your book is on the table by the door in Waterstone's, you're made," says one publishing executive who asked not be named.

"If it's not, you're toast."

Not everyone is pleased by this.

Smaller retailers, whose influence with publishers has waned, fell squeezed out and are often unable to compete on price.

Critics complain that the multiples assist "dumbing down", by shunning minority titles in favour of meretricious movie tie-ins, bland middlebrow fiction and shiny picture-books.

Purists, meanwhile, gripe that booksellers seem increasingly reluctant just to sell books, devoting increasing space to attractive but irrelevant coffee shops and juice bars.

High Street hits back

Not fair, say the multiples.

Cathy Ferrier, head of books for WH Smith, argues that accessible High Street chains help introduce books to a wider clientele.

Jamie Oliver: More interested in writing books than reading them

"If I can convert someone who comes in for a magazine, and get them to pick up a book, that's a victory," she says.

The firm's existing presence in music and video retailing puts WH Smith in a strong position to piggyback book sales on other media, she says, pointing out that Harry Potter books bounced back into the charts after the launch of last year's film.

At Waterstone's, a deliberately more highbrow chain that comes a close second in sales to WH Smith, marketing director Lesley Miles argues that multiples can be good for choice.

"Only big stores like ours can stock the sort of range our customers want," she says.

The customer is king

Nor do the multiples concede that they manipulate customer taste - indeed, they claim to be constantly astonished at the twists and turns of market demand.

There are other books on the market

Although some of the names in last year's bestseller lists were deeply predictable, notably TV tie-ins and the inevitable Harry Potter, some sprang from nowhere.

Lesley Miles points to Billy, the biography of a superannuated comedian, as a hit that "took pretty much everyone by surprise."

"For that reason," says Nicholas Clee, "publishers and booksellers cannot afford not to plan for the unexpected, and have to keep investing in little-known talent."

Certainly, the volume of book publishing in the UK, in excess of 100,000 new titles every year, has not fallen in recent years, and remains among the highest per-capita figures in the world.

Value, not volume

Good or bad, the multiples are here to stay.

But whether they can continue to prosper is another question.

But where's daddy?

So far, much revenue growth has been driven by selling higher value books.

The Harry Potter phenomenon was largely fuelled by �10.99 hardbacks, a unit price way in excess of what publishers can normally expect from the children's market.

Steve Bohme at BML says many publishers are deliberately slapping higher price-tags on their titles, anticipating that retailers will want to discount them.

But selling more to the same customers will not keep profits growing forever; booksellers also have to start tempting more people into their shops.

And the indications here are not especially encouraging: the average 15-year-old boy spends four times as long playing computer games as reading, and almost half of fathers have ever read to their children, according to a survey published on Wednesday by Waterstone's.

The adults are no better: according to another recent survey, only one in 10 Britons buys more than 10 books a year, and 50% of the population never buy any books at all. Overall, Britain has the lowest rates of reading for pleasure in the developed world.

It seems not everyone is reading Harry Potter after all.