well, the way I see it is that the author still has an overall story arc in her head, but it can get influenced by what her readers have to say. If used intelligently, the reader's input would not change the main story line at all, and if anything, it would enhance it.
the only thing constraining about it is the time frame you would give yourself between "episodes" - if too often, it defeats the purpose, if not often enough, you will not get the readership...hence, this becomes more like journalistic style of writing, rather than traditional fiction writing.
Sorta makes the author appear lazy,
indecisive, unsure of his imagination, honestly.
I don't see it that way. Traditional reading in this country (and I would imagine all over the world) is down, and this is just a way of bringing a traditional medium (novel) into this century. Everything consumers do these days, they want to be able to customize, so why not a novel?
Think about it: most people these day have pretty hectic lifestyles leaving little room for reading. I don't remember the last book I read cover to cover since I left school - right now the only thing I find time for is reading quips you guys post or link to and maybe a couple of magazine articles each day....and maybe a couple of poems here and there...but that is about it - and that is without having any kids!
When I find a wovel I enjoy reading, I will let you guys know.