It's possible in theory to do exactly what you suggest, but as I argued a while ago, I think the people with the best shots at being the premium writers are the trad pubbed big names. It will probably be large companies that control the access to such opportunities, and they'll go with the names they know.

Think about the current situation. The affluent buy designer labels to wear, not unknowns. They go to Michelin Five Star Restaurants (or maybe a lesser known spot if a trusted source recommends it). And so on.

Self publishing exists because of two trends--the rise of internet shopping, and the rise of digital book formats. The former overcame the space limitations of bookstores, virtually none of which would give shelf space to vanity press titles. But an internet book store can offer space to indies because its virtual shelf space is, if not infinite, at least vastly greater than that of any brick-and-mortar store. The latter made it possible to buy books relatively cheaply, thus making readers more likely to try someone new.

Even with those two trends both in place, self publishing might not have developed if Amazon hadn't developed an ereader and wanted more content for it. Or maybe it would have developed if some other company had a need for large amounts of digital content.

My basic point is still the same either way--self publishing is a fragile ecosystem. Some people have done very well with it, and it's given many more at least a chance. But it's not well positioned to leap from its current egalitarian mode--everyone gets a chance--to a premium offering. For that you need financing and trusted sources to get the affluent interested. Most of us don't have either. Even the ones who make a living at self publishing aren't usually household names. And think about how much of a struggle it is to get space on library shelves. (Admittedly, that's partly because of shelf space constraints, but even with digital libraries, librarians often go only for curated collections, which usually means the service picks out the very bestselling titles) To break into the ranks of premium products bought by the affluent, you'd need something like the equivalent of being picked for one of the big celeb book clubs, cracking the bestseller list, or at least getting a starred review from Kirkus or similar.

That said, I'm not pessimistic about the future. But that's because I still hold out hope for some reasonable AI regulation, not because I think we can survive by being a premium product. Being human written will give our books an advantage, but probably not enough by itself to get the job done.

Unfortunately, AI can't reliably identify AI. Authors have experimented by sitting down, writing a short piece on the spot, and running it through a detector. More often than not, the detector finds AI where none could possibly exist.

Perhaps we should let AI decide who wins the awards.  Just take humans out of the loop altogether.   

Umm, then will humans self-identify as AI to win AI-chosen awards?  A slippery slope is a slippering slope for everyone/thing.

It's worth noting that the political climate is shifting, just as I predicted. The administration is still highly pro-AI, but as we've seen, the administration has done 180s on other things. It's noteworthy when figures from the left and right (in this case, Bernie Sanders and Ron DiSantis) both attack AI in the same week, Sanders by invoking a dystopian future, Di Santis by arguing in favor of a state-level right to regulate AI in the interest of protecting its citizens.

AI-inspired unemployment is growing steadily and becoming more noticeable. With important elections coming up, that's not a stat many politicians will be willing to ignore.

As this trend continues, it's likely we'll see other types of AI bans emerge. AI will always be with us, but I think a chance of keeping out of areas where it's not needed.

Robot-written science fiction or fantasy prose is not a cure for cancer, so where is the moral imperative to include it or judge it alongside human-written prose?

AI stories are fakes, pastiches of stolen words and phrases. More than ten of my own books were stolen and used to create AI--and that's just the one legal case. Do you think I want some lazy person who can't be bothered to write a novel on their own to gain a literary prize based on using even one of my stolen words? No, I do not.

I'm not too happy about them selling books using that tactic, either.