Epublishers release their books in digital format although some also offer print options mainly in the form of print-on-demand publishing.
The advantage to epublishing is a wider range and number of publishers as well as less pigeonholing of book types. Since the costs of producing an ebook are much smaller than with paper-published books, the publisher can afford to publish books that don't fit tight market requirements.
Most epublishers handle the cost of editing and cover design, but only a few offer a very small advance of royalties.
You will usually have a great deal of impute into the cover art, editing, and the book blurb.
Distribution is nonexistent in bookstores, of course, but the books are available either at the publisher's website and ebook distribution sites like Fictionwise where they will be sold with the ebook versions of books from traditional publishers and small press.
One major disadvantage is less money. Not enough people are buying ebooks yet so the money isn't there.
Even erotica, the growth market for ebooks, isn't offering much profit for most new authors because of the glutted market.
Those most successful in ebooks are prolific writers who are able to produce three or more high quality books a year that are sold to the same audience. That audience buys all their books, and each new book draws in more readers who buy the backlist. Darrell Bain and Charlee Compo are good examples of this kind of success.
Epublishing companies also have the same disadvantage as small press. They are run by individuals so an illness or family tragedy can put your book on hold, or the publisher can fail completely.
SELF PUBLISHING IN EBOOK FORMATS
You can format your book into an ebook then sell it from your website.
The advantage is total control and a much cheaper setup cost than a paper book. The disadvantages are much the same as with any form of self-published book. You will also be unable to sell it through venues like Fictionwise where a majority of ebooks are sold.
A WEB NOVEL
The final market really isn't a market because no profit is made.
If you want to be read and money doesn't matter, putting your book on the web for free via a website, a blog, a free download site like Memoware, or a listserv like Yahoogroups may be the route to take.
You will have to promote for readers, but you will get them, and a few will actually comment on your work.
Some writers do this as a learning experience. Others simply don't want to bother with the hassle of the publishing process.
The disadvantages are no money and the possibility your book may end up elsewhere without your permission.
The simplest way to gain popularity, readers, and comments is to write in a popular fan fiction universe like Harry Potter or HEROES. A decent writer can become a big fish in a very small pool with lots of fans and none of the heartache of the professional markets.
If you're still confused about which market you should try, think long and hard about what you really want from publishing and go from there.
And welcome to the wonderful world of publishing. Tighten your seatbelt because you're starting one heck of a bumpy but fascinating flight.