Monday, June 26, 2006

The Long Tail

Last session of the conference for me was a great talk by Chris Anderson about, shockingly, The Long Tail. I'd never seen him speak before and was as impressed as I thought I would be. A few folks in the audience questioned some of his optomism that the market will allow more choices for consumersdue to past history of monopolies in telecom and other areas. Fairly valid points.

Long Tail - Chris Anderson

Librarians in sweet spot for long tail

Who needs megahits?
Most culture local before tv – created hits
N*sync 2nd lp last megahit record – drop in sales after that (flat if you include digital)
More music but less hits
Same for tv
More choice scatters demand
Mix of hits and niches
More fragmentation – hits have less viewers than in past

Where are they all going?
Long tail=Powerlaw
13,000 movies shown in festivals, infinite demand, not enough screens – where box
office drops off
common interests – explosions, stars etc. formula for LCD fare
bottleneck bet supply and demand
rhapsody data 05: walmart 4200 unique titles per store, 25,00 songs at both wm and rhap, 1.5
millions songs on rhap and not wm
65,00 lps last yr, walmart carried 700 [damn]
wm ignores half market
same for blockbuster v netflix/amazon v b&n
LT sales quarter of amazon biz
Onlines sales eventuall half maket

3 forces of LT:
democratize tools of prod (more stuff)
democratize distribution (internet) – more comsumption
connect supply and demand (google) – drives biz to niches

not just about entertainment
google: LT advertising – blogs as advertisers, LT keywords on adsense , targeted ads on
big scale [niche advertising]
ebay: LT goods
capital1: LT customers – 1,000,000s of personalized Ccs, created huge debt problem!
Open source: LT talent – good programmers all over world in google contest
Microbrew: LT beer – improved distribution of small beers

After the blockbuster...
Small is new big
Many is new few

10 fallacies of “hitism”
1. everybody wants to be star
2. everybodys in it for $$$ (non monetary economy)
3. only success is mass success (microstars – reach small community)
4. direct to video is bad
5. self publishing is bad
6. amateur = amateurish (bloggers amateur publishers despite level of experise)
7. low selling=low quality (niches)
8. if it were would it would be popular
9. economics of head apply to whole tail
10. you can focus on strong signals and ignore weak signals (authenticity for below)

long tail of books:
online retail
used books
Ebooks (someday)

Used books:
Sales up 33% last yr, 10% of book sales – virtual inventory
Impact of primary market? Sell new for more due to resale value – don’t know w/ books
Children will never know meaning of OOP – used book integrated in distribution

Eliminate inventory probs for stores, wont order too much and return

“paper books have excellent battery life”
tech improving

Online databases
Google (etc) book search

aggregate “distributed inventory” – distributed supply/ distributed demand [do somewhat in
GA with statewide borrowing agreements. and at MPOW between campus libraries]
Circ hit centered (10% = 90% of circ)

Online Databases:

Book search:
Distributed over tail
OReilyey: 4% IP/ 20% PD/ 75% or more in twilight zone (copyright constraints orphaned etc) – change to revive big part of culure history

GreaseMonkey script for lib info on Amazon
LibraryLookup reminders – RSS of book availability in libs

5 LT Lessons:
1. don’t confuse limited distribution with shared taste
2. everyone deviates from mainstream
3. one size no longer fits all (one size fits one now)
4. best stuff not necessarily at top
5. masss market becoming mass of niches

Q: Will publishers or LT disappear?
A: hits never go away, monopoly of hits will go away

Q: How will net neutrality issues effect LT issues?
A: Don’t think companies CAN do what they want w/ slow and fast lane broadband, regulating net will go horribly wrong, currently innovate where you want online, special hi speed services will exist (Comcast video on demand),consumers have power and choice – best regulating force!

Q: Don’t have multiple BB options everywhere
A: yes you do, you have choice

Q: Can power centers chop off LT?
A: Not in ma bell era anymore, different model, nobody has power to shut down, consumer paradise now not monopoly

Q: How do you deal with customer trust?
A;:brands proxy for quality, more consumer choice info means sony cant sell stuff for as much $$$, stuff all made in same place anyway – off brands pretty much same, collective wisdom will help avoid mistakes

Q: Implications of LT for children?
A: homeschool kids LT of childrens market, demand for all sort of niche content

Q: End to LT? Not as good distribution in rural areas for goods and internet.
A: 1896 Sears catalog (LT of 19th c) – huge variety, cheaper prices, digital distribution will help, more options w/ broader range for BB, sattelite good too

Q: Common carrier laws mean no DSL w/ dialtone, less choice, more cost. Where do you get optomism due to history of monopoly forces?
A: technology means more choices, will get more stuff
Audience: based on faith not historical fact!

Q: How does LT effect idea of place?
A:Cities proto LT, market for more stuff, NYC LT for food, ability to market culture more broadly, distributed demand for NO culture -can get music/ food virtually, market whats unique about cities, virtual appreciateion
Q: What about community?
A: community not necessarily in person

Q; Effect of copyright on LT distribution?
A: biggest LT problem, "wkrp" not available now anywhere, have to clear rights for 30 songs/ episode, too expensive, a lot ofTV disappears due to rights issues. Cant reach rights holders for books/ music/ video, need industry to come up w/ simple rights clearance


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