Authors can now use Pressbooks to format and create an Epub ebook, and once they're done they can upload the ebook to BookBaby.
Creating the ebook is of course still free (for a limited number of titles), but authors will have to pay BookBaby's $99 flat fee to distribute the ebook. BookBaby currently distributes to 11 different ebooks stores around the world, including Kindle, Kobo, Nook, and iBooks.
Pressbooks was originally launched in mid-2011, but only went public in November 2011. Since then they've added a number of improvements and new features, including a previous attempt to manage ebook distribution in-house. According to Hugh McGuire, the founder of Pressbooks, they decided to abandon that effort because:
We found when we were directly involved in distribution, we were just sitting in the middle between authors, our distribution partner, and retailers … taking a cut for essentially being in the way.
Rather than add cost, Pressbooks decided to get out of the way and focus more of their attention on adding value by improving the service.