The Washington Post is giving up its stand-alone book review section. This means The New York Times Book Review is the last biggy left.
Motoko Rich, the author of the article on the Post (which ran in The New York Times) said that its book review section wasn't bringing in enough advertising to justify keeping it around. Publishers, Rich says, "generally spend very little on newspaper ads. Publishers now focus their marketing dollars on cooperative agreements with chain bookstores, which guarantee that certain books will receive prominent display at the front of stores."
The problem with putting all your money into store displays is that you're marketing only to people who are already in the stores, which I'm assuming is a smaller, self-selecting group, rather than to a more general population. I also don't know that I'd call having to pay to get your books displayed "marketing."
Some of the newspapers that have given up separate book review sections are still carrying book reviews, they're just carrying them in other parts of the paper. About that situation David L. Ulin, book editor of The Los Angeles Times, is quoted as saying, "In a section where there are a variety of elements, there might be people who might not ordinarily look at book reviews who might now look at book reviews...You could argue that putting books into the general mix opens more people to that conversation."
I think he may have a point there. I, personally, don't know many people out here in the carbon-based world who would actually sit down and thumb through a book review section. But if a review just happened to be next to an article on what happened to Caroline Kennedy's Senate bid, they just might notice it.