D R A F T: The Long Tail: The Internet, Culture, and the Mega-Store
Monday, 6/26/2006
Chris Anderson, founding editor, Wired, contributor, The Economist, started career: Nature, Science, research at Los Alamos National Laboratory. New book out.
Who needs megahits?
20th Century hit driven; largely regional culture to begin, then radio and TV.
21st Century begins: NSync—3/21/2000. Tech stock bubble burts. NSync sales will be highest numbers ever, forever. Hit machine gearstripped since then. CD sales flat, # of hits fallen by 50% .
Network prime-time audience share vs multichannel TV household penetration. Demand spreads with more access/content.
Top-rated TV shows, news anchors, fragmented demand
Powerlaw curve—1/x –freakily ubiquitous. On logarithmic scale, s/b straight. Trails off when distribution ends—only can have so many movie screens, etc.. Megaplexes require concentrated demand. Need lowest common denominator fare.
Supply & demand hit a bottleneck. Opportunity. Wal*Mart carries 4300 CD titles typically—tiny classical, jazz, world music sections—largest music retailer in US. Hits=25,000 tracks. Rhapsody online music store has over 1,200,000 tracks.
Foresees ½ of market will be hits, ½ niche non-hits
Force 1: Democratization of the tools of production: blogging, mySpace,
Force 2:Democratization of distribution
Force 3: connect supply and demand. Result drives business from hits to niches. Think Google. Ability to manipulate results via filter.
Google: Long tail advertising. PVRblog. Little folks can now reach worldwide markets.
CapitalOne—personalized credit cards—individually tailored
Long tail talent—Google talent search—programmers –winners from all over the globe, who thought there were incredible programmers in Madagascar?
Long tail libations—microbrews—distribution has improved
After the blockbuster—small is the new big, many is the new few.
10 fallacies of “hitism”
1. Everyone wants to be a star.
2. Everyone’s in it for the money. Rise of the nonmonetary economy.
3. The only success is mass success.
4. “Direct to video=bad
5. Self-published=bad. Lulu.
6. Amateur=amateurish. Latin root-love. Wikipedia. Blogs.
7. Low-selling=low-quality
8. If it were good, it would be popular.
9. The economics of the head apply to the whole market.
(microhits and ministers)
10. Focus on strong signals and ignore the weak signals.—weak signals are where the interesting things are happening.
The long tail of books
1. Online retail
2. Used book network. Fastest growing portion of the book market—up 33% last year—increased liquidity. Effect of classic secondary market—how will it effect the primary market? Expansion of “virtual inventory”. Our children will never know the meaning of “out of print”.
3. Print on demand. Smoothes out inefficiencies in market. Sony Ereader. Time may be coming
Libraries Long Tale
1. Interlibrary loans—distributed inventory –virtual access.
Collection overlap between “Google 5” libraries (Harvard, Stanford, Michigan—bigbig libraries)—only 40%. 10% of books=90% of circulation
2. Online dbs. JSTOR—like Google for scholarly works. Libraries offer unique access/abilities
3. Book search. Google Books—inevitable as technology gets cheaper.
Opportunity
4% books in print
70% unknown
20% gov docs
GreaseMonkey plug-in for Firefox browser
Hacks Amazon to show library availability. Shows overdues, RSS for availability.
Five lessons:
1. Don’t confuse limited distribution with shared taste
2. Everyone deviates from the mainstream somewhere
3. One size no longer fits all.
4. The best stuff isn’t necessarily at the top.
5. The mass market is becoming a mass of niches.
Q&A
Will Wal*Mart and Amazon go away?
Hits will not disappear—the lowest common denominator will always sell
What happens w/o net neutrality? AT&T, etc., owns net?
Doesn’t think cable/ telecomm companies have the ability to do what they say. If you regulate the net, it will go horribly wrong. Chokes innovation—look at cell phone market. Thinks there will be maybe two tiers, but consumers have all the power and their choices will regulate the market.
Big business wants to keep their share of the market?
The marketplace will become a consumer paradise.
Trust as a factor?
Brands are a proxy for quality. Measure brand by price premium. Now Sony can only charge a smaller price premium, because we have the info, amateur reviewers, etc. We know all the X are made in the same factory in China.
Implications for long tail on children’s library services?
Home-schooled=long tail. Something out there for every thinking.
Is there any end to the long tail? Rural areas?
Proto-long tail: 1896 Sears Roebuck catalog. Technology is on our side—digital delivery.
Must have dial tone for DSL—monopoly for Verizon. Where does your optimism come from?
Technology is enabling more choices.
New Orleans?
Cities are long tail—more variety, more diversity. Places with distinct culture can market that, and find a broader market.
What about community?
People want to live in cities to engage with other people.
Copyright law as a constraint on distribution?
Biggest problem. WKRP rights would need to clear 30 songs per episode—impossible task. Copyright is a barrier—too complicated to figure out who owns what. We need a new industry/model…
Wow. That was a half-hour talk plus 15 minutes Q&A. Will take me MUCH longer to ponder/digest. And I missed stuff whizzing by. Certainly, the implications for our industry are VAST.
Selling/signing book: The Long Tail : Why the Future of Business Is Selling Less of More (Hardcover)
Dang, it’s not in our catalog—I may have to do an ILL!
Chris Anderson, founding editor, Wired, contributor, The Economist, started career: Nature, Science, research at Los Alamos National Laboratory. New book out.
Who needs megahits?
20th Century hit driven; largely regional culture to begin, then radio and TV.
21st Century begins: NSync—3/21/2000. Tech stock bubble burts. NSync sales will be highest numbers ever, forever. Hit machine gearstripped since then. CD sales flat, # of hits fallen by 50% .
Network prime-time audience share vs multichannel TV household penetration. Demand spreads with more access/content.
Top-rated TV shows, news anchors, fragmented demand
Powerlaw curve—1/x –freakily ubiquitous. On logarithmic scale, s/b straight. Trails off when distribution ends—only can have so many movie screens, etc.. Megaplexes require concentrated demand. Need lowest common denominator fare.
Supply & demand hit a bottleneck. Opportunity. Wal*Mart carries 4300 CD titles typically—tiny classical, jazz, world music sections—largest music retailer in US. Hits=25,000 tracks. Rhapsody online music store has over 1,200,000 tracks.
Foresees ½ of market will be hits, ½ niche non-hits
Force 1: Democratization of the tools of production: blogging, mySpace,
Force 2:Democratization of distribution
Force 3: connect supply and demand. Result drives business from hits to niches. Think Google. Ability to manipulate results via filter.
Google: Long tail advertising. PVRblog. Little folks can now reach worldwide markets.
CapitalOne—personalized credit cards—individually tailored
Long tail talent—Google talent search—programmers –winners from all over the globe, who thought there were incredible programmers in Madagascar?
Long tail libations—microbrews—distribution has improved
After the blockbuster—small is the new big, many is the new few.
10 fallacies of “hitism”
1. Everyone wants to be a star.
2. Everyone’s in it for the money. Rise of the nonmonetary economy.
3. The only success is mass success.
4. “Direct to video=bad
5. Self-published=bad. Lulu.
6. Amateur=amateurish. Latin root-love. Wikipedia. Blogs.
7. Low-selling=low-quality
8. If it were good, it would be popular.
9. The economics of the head apply to the whole market.
(microhits and ministers)
10. Focus on strong signals and ignore the weak signals.—weak signals are where the interesting things are happening.
The long tail of books
1. Online retail
2. Used book network. Fastest growing portion of the book market—up 33% last year—increased liquidity. Effect of classic secondary market—how will it effect the primary market? Expansion of “virtual inventory”. Our children will never know the meaning of “out of print”.
3. Print on demand. Smoothes out inefficiencies in market. Sony Ereader. Time may be coming
Libraries Long Tale
1. Interlibrary loans—distributed inventory –virtual access.
Collection overlap between “Google 5” libraries (Harvard, Stanford, Michigan—bigbig libraries)—only 40%. 10% of books=90% of circulation
2. Online dbs. JSTOR—like Google for scholarly works. Libraries offer unique access/abilities
3. Book search. Google Books—inevitable as technology gets cheaper.
Opportunity
4% books in print
70% unknown
20% gov docs
GreaseMonkey plug-in for Firefox browser
Hacks Amazon to show library availability. Shows overdues, RSS for availability.
Five lessons:
1. Don’t confuse limited distribution with shared taste
2. Everyone deviates from the mainstream somewhere
3. One size no longer fits all.
4. The best stuff isn’t necessarily at the top.
5. The mass market is becoming a mass of niches.
Q&A
Will Wal*Mart and Amazon go away?
Hits will not disappear—the lowest common denominator will always sell
What happens w/o net neutrality? AT&T, etc., owns net?
Doesn’t think cable/ telecomm companies have the ability to do what they say. If you regulate the net, it will go horribly wrong. Chokes innovation—look at cell phone market. Thinks there will be maybe two tiers, but consumers have all the power and their choices will regulate the market.
Big business wants to keep their share of the market?
The marketplace will become a consumer paradise.
Trust as a factor?
Brands are a proxy for quality. Measure brand by price premium. Now Sony can only charge a smaller price premium, because we have the info, amateur reviewers, etc. We know all the X are made in the same factory in China.
Implications for long tail on children’s library services?
Home-schooled=long tail. Something out there for every thinking.
Is there any end to the long tail? Rural areas?
Proto-long tail: 1896 Sears Roebuck catalog. Technology is on our side—digital delivery.
Must have dial tone for DSL—monopoly for Verizon. Where does your optimism come from?
Technology is enabling more choices.
New Orleans?
Cities are long tail—more variety, more diversity. Places with distinct culture can market that, and find a broader market.
What about community?
People want to live in cities to engage with other people.
Copyright law as a constraint on distribution?
Biggest problem. WKRP rights would need to clear 30 songs per episode—impossible task. Copyright is a barrier—too complicated to figure out who owns what. We need a new industry/model…
Wow. That was a half-hour talk plus 15 minutes Q&A. Will take me MUCH longer to ponder/digest. And I missed stuff whizzing by. Certainly, the implications for our industry are VAST.
Selling/signing book: The Long Tail : Why the Future of Business Is Selling Less of More (Hardcover)
Dang, it’s not in our catalog—I may have to do an ILL!
posted by lislemck at 5:11 AM
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