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Doubts Multiply About the "Long Tail" 194

Posted by kdawson
from the to-him-who-hath-shall-be-given dept.
fruey sends in a New Scientist analysis of the many second thoughts about the Long Tail theory. It summarizes four studies that show, in different markets, that the tail is both flatter and thinner than originally supposed, and that blockbusters are not going away in those markets — they are getting bigger. It's theorized that widely used collaborative filtering software is magnifying the winners' share of the various pies, and peer influence is a large contributor to consumer behavior.
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Doubts Multiply About the "Long Tail"

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  • I stopped buying CDs when the music companies started sueing their own customers.

    So I'm not even part of the fat root :-)
    • by clam666 (1178429) on Tuesday December 23, 2008 @04:06PM (#26215431)

      I stopped buying CDs when the music companies started sueing their own customers.

      You too? I thought I was the only one. I rarely bought music in the past, then downloaded a few songs which I would never have paid for but just wanted to hear. Then the RIAA started with their crap and I stopped listening to it all. There's nothing like being blamed for their crappy product. I mean, have the major labels actually put out that much good music in the last 10 years to even download? It seems like the bar has gotten awfully low.

      As far as the "long tail" theory, I'm surprised that it was accepted that much at the time. Anderson sounded like the he had the same kind of glazed eye look about the future of the internet as the Web 2.0/Social networking people do when you talk to them.

      Do people fundamentally change when they have more than one option to choose? I would have guessed rarely. Just because people have more choices does not mean they make statistically random choices. People have far greater psychological issues about what they choose and why they choose them than just availability. People like to be on the bandwagon and choose what their friends do, they like to choose things they've heard of and feel safe about, what's been recently marketed to them, comfort foods vs. healthy foods, etc.

      Although we are all unique individuals following the herd, we by-and-large make the same choices about things, with a little bit of variance thrown in to keep it interesting. Raise your hand if you've never eaten at a McDonalds or drank a Coke before.

      The internet may offer a wide variety of things in theory, but in reality it is businesses trying to offer customers the products that will give them the best ROI, and that means you'll make more money off the herd than a few outsiders demanding obscure products and services.

      It makes sense to push items that the herd wants to buy. It makes sense to push the same things the other players are pushing and focus on better volume marketing, rather than pushing obscure things that a relatively few want and spending more money on targetted advertising.

      The consumer follows the same approach as others, otherwise Walmart would not have been able to be in the position it's in.

      • by D Ninja (825055) on Tuesday December 23, 2008 @04:23PM (#26215625)

        I mean, have the major labels actually put out that much good music in the last 10 years to even download? It seems like the bar has gotten awfully low.

        Possibly. Or maybe you've just aged and your tastes have changed as they've become more refined (a nice way of saying you've become pickier). That sort of makes sense since you, being older now, are not the RIAA's primary target market (which tends to be in the teens, younger 20s, etc). Additionally, being older, you're also not as impressionable. A song that would have affected you at age 15 (when emotions were high, and many experiences were imprinting themselves on your mind) would barely make a dent now or may not even be noticeable.

        There has been good stuff produced in the past 10 years. I know names like Britney Spears pops to mind when you think about the crap out there, but there are a lot of artists who are part of the big labels who don't get the same face or radio time for whatever reason.

      • by rasper99 (247555)

        Raise your hand if you've never eaten at a McDonalds or drank a Coke before.

        I haven't had McDonalds in 16 years after a bad experience. A couple times I've been with a group and everyone wanted to go to McDonalds. In the past I said I haven't been there in like 8 years and they were easily swayed to go elsewhere.

    • Too bad the article only focuses on legal downloads and such. I'm pretty sure that the long tail effect does exists, just not in the paid download market.

    • by poetmatt (793785)

      I must say, it's quite an accomplishment that for a product that would normally have steady demand to have the whole recording industry crying foul at the same time, and doing horribly. It's like the RIAA doesn't want to actually make money or something.

    • by timeOday (582209)

      I stopped buying CDs when the music companies started sueing their own customers.

      So I guess you'll start buying again now that the lawsuits are over [streamingmedia.com], eh?

  • by thedonger (1317951) on Tuesday December 23, 2008 @03:39PM (#26215099)
    Looks like he got his long tail, but I don't know why anyone would expect Harry Potter to sell less simply because someone could chose to get some out-of-print book or the like. Fill Barnes and Noble with shitty fantasy that will never sell and HP will still break records. The Internet can't change that.
    • by CyberLord Seven (525173) on Tuesday December 23, 2008 @04:00PM (#26215357)
      "The Long Tail" did not suggest that Harry Potter would sell less. It suggested that a less well-known, or liked, book could make as much money as a Harry Potter or more because the internet would allow those who liked such things to find them more easily.

      For instance, we all know about The Curious Case of Benjamin Button because of all the advertisement money spent on it and the use the Oprah Winfrey's show as an additional ad vehicle along with "E" and other such crap that fills the airwaves.

      If "The Long Tail" is accurate, then there could be a much smaller independant movie that will could be released at the same time as The Curious Case of Benjamin Button and that will make as much money as The Curious Case of Benjamin Button, but in a longer time frame. This is because you and I think this independant movie stinks when we hear about it, but your neighbor and mine thinks it's the Bee's Knees and search out art-house showings and buy the DVD and watch it whenever it shows on the Idependant Film Channel and Sundance and spread the word so that the thing takes on it's own life in a manner similar to The Rocky Horror Picture Show.

      Of course, if "The Long Tail" is wrong, then this independant film will more likely resemble "Howard The Duck".

      • Ah, I see your point. As far as the movie example, $10 per ticket will give "top tier" movies like Benjamin Button such a jump in gross sales that art house flicks and other creepers in the long tail section will never make up the ground. Net sales, OTOH, may be a different story.

      • Not exactly. (Score:5, Insightful)

        by khasim (1285) <brandioch.conner@gmail.com> on Tuesday December 23, 2008 @04:20PM (#26215581)

        "The Long Tail" did not suggest that Harry Potter would sell less. It suggested that a less well-known, or liked, book could make as much money as a Harry Potter or more because the internet would allow those who liked such things to find them more easily.

        Not exactly.

        It is the hypothesis that ALL of the non-Harry Potter books COLLECTIVELY will sell as much or more than the Harry Potter books themselves.

        Even that is wrong. It isn't a single book or a single series. It's the percentages. It is the hypothesis that the 80% of lesser selling titles will equal or exceed the sales of the top 20%. Or 90% / 10%. Or wherever you want to make the cut.

        In theory, it is easy to demonstrate. Suppose there are 2 blockbusters released in a category ... and the average person buy 10 items in that category. So, 20% of the sales would go to the blockbusters ... but 80% would go to the "long tail".

        The problem is that the average person does NOT operate that way. They might by the latest Harry Potter book ... and no other book that year. The same with music. The same with movies.

        • In theory, it is easy to demonstrate. Suppose there are 2 blockbusters released in a category ... and the average person buy 10 items in that category. So, 20% of the sales would go to the blockbusters ... but 80% would go to the "long tail".

          And that just illustrates the problem with thought experiments to "prove" anything. If you can make up the numbers or handwave in anecdotes and "common sense" in as "data", you can prove any bloody thing imaginable.

          E.g., Aristotle "proved" that women have (as in, are bo

      • The Curious Case of Benjamin Button is available online free courtesy of Univ of Virginia:

        http://xroads.virginia.edu/~HYPER/Fitzgerald/jazz/benjamin/benjamin1.htm [virginia.edu]

        How does that figure into the tail?

        • by CyberLord Seven (525173) on Tuesday December 23, 2008 @05:48PM (#26216491)
          Ummmm. I don't like watching movies or television shows on a computer. That's why I buy (yes, I actually pay) for DVDs.

          Or, at least, I used to. A few years ago I got sick and tired of being FORCED to watch advertisements for movies I will NEVER watch, and FBI warnings that mean nothing to me. So, I stopped buying DVDs.

          Now I just watch them at the theatre if I think they will be good or just wait for them to appear on U-Verse.

          ***offtopic***Will someone tell those ass-wipes in Hollyweird that they are losing valuable customers with this practice of putting in useless ads and trying to force people to watch them. I have DVDs that are getting long in the tooth and it's kind of sickening to see ads for movies that have come and gone. Why can't things be like my DVD of The Matrix? When I put The Matrix into my DVD Player, the thing starts at the movie! What a unique concept! DUMBASSES!

          Don't even get me started on Blu-Ray. I'm supposed to buy my movie collection again just to get innundated with the same crap?***offtopic***

          • Will someone tell those ass-wipes in Hollyweird that they are losing valuable customers with this practice of putting in useless ads and trying to force people to watch them.

            Someone did. If you put a DVD in today and it starts playing trailers 99 times out of 100 if you press menu or skip it will take you straight to the DVD menu. A few years ago you were forced to watch that crap, but generally not any more.

          • by corbettw (214229)

            Universal DVDs start with a splash screen, asking if you want to watch previews. After a few seconds, it goes on to the menu (and you can load up the previews from there, if you so desire). So that's one movie company that gets it.

            • Re: (Score:3, Interesting)

              by Floritard (1058660)
              Yea no. That's better than say Disney and their offensive attempts at disabling parts of your remote during their previews, but it's still a far cry from ideal.

              Remember when DVDs first came out? You could watch previews, if you actively looked for them on the disc. They were often sequestered in the special features menu. Which is ideal because trailers for future movies have a shelf life of a month or two. Whereas the movie you purchased is meant to last for years. That was the whole point of buying it
          • by gilgongo (57446)

            Don't even get me started on Blu-Ray. I'm supposed to buy my movie collection again just to get innundated with the same crap?

            I take it you have not [wikipedia.org] discovered [wikipedia.org] the alternative [btjunkie.com].

      • by jythie (914043)

        Long tail got a bit too much hype as people hoped that obscure artists would be AS successful as the popular ones and that turned out to be garbage.

        However, long tail DID hold true for obscure artists having any chance at all and made obscure stuff MUCH easier to find. Now instead of only having access to what most people want, the smaller stuff is available for purchase.

        Music is a good example, esp if you look at dementia/filk/etc. In the past you basicly had Weird Al and a few other major ones that, wel

      • Re: (Score:3, Insightful)

        I don't think that's what The Long Tail says at all. It doesn't say that an obscure indie movie or book should make as much as a blockbuster. It just says that the indie movie ought to be able to make money now, when it would have lost money under older distribution systems.

        The indie movie shouldn't need to gather a huge cult following. It just needs to find the audience that would enjoy watching it. That wouldn't have happened under the old 'roll out in thirty theaters nationwide model'. According to

      • by dwye (1127395)

        Well, that theory worked for Eddie And The Cruisers, which did nothing much in the theaters, then kept selling in video tape and DVD form.

        > Of course, if "The Long Tail" is wrong, then this independant film will more likely resemble "Howard The Duck".

        The film or the comic book? The comic book was famous, when I was in college, for being the most valuable on the market, because so few copies had been made of the few episodes. One HtD was worth 10-20 copies of Action Comics No. 1 (which introduced this g

      • Re: (Score:3, Insightful)

        by GiMP (10923)

        Of course, if "The Long Tail" is wrong, then this independant film will more likely resemble "Howard The Duck".

        Which coincidentally enough, just made it onto Hulu this week! I intend to watch it again, as I was strange enough to have loved this as a child. It was my favorite movie, in fact.

  • Definition (Score:5, Interesting)

    by spuke4000 (587845) on Tuesday December 23, 2008 @03:39PM (#26215103)
    What is the long tail? The summary, and TFA (I skimmed it so maybe I missed this) seem to indicate that the long tail theory means the more obscure stuff will be more popular. I thought it simply meant that you could make money off the obscure stuff when your distribution costs went to zero (because of the Internet). Am I missing something, or does the article interpret the idea of the long tail incorrectly?
    • by Endo13 (1000782)

      Well, this was my first encounter with "the long tail", so all I know about it is what I read in the article. It seems this particular article is defining "the long tail" as an ability for retailers to sell a lot more different items, so some of the peak demand for the most popular items (blockbusters) gets spread out to the extra selection that wouldn't normally be available in a B&M store. Also, it briefly mentions a small possibility of an unexpected blockbuster arising from that extra selection.

    • Re: (Score:3, Informative)

      by DaveV1.0 (203135)

      The idea that the internet is transforming our buying habits was first popularised in an article written by Chris Anderson, editor-in-chief of the technology magazine Wired, in October 2004. The article, titled "The long tail", became a blog, a best-selling book and a marketing mantra.

      Anderson's premise was simple. Before the internet, even the largest retailer had physical constraints on the variety of stuff like books, CDs and DVDs it could profitably sell. Savvy store owners had to tailor their stock to

    • Re: (Score:3, Informative)

      The phrase "long tail" has a couple of related, but different meanings - both from the shape of a graph of sales (or popularity) on the Y-axis.

      In this case, the X-axis is a listing of different titles, sorted by popularity. There are a small number of extremely popular items, tailing off to huge numbers of less popular items.

      In the other use, the X-axis is time. Something can be hugely popular for a few days/weeks/months, but will continue to have greatly diminished sales for many years to come.

      The concept

    • Re:Definition (Score:5, Informative)

      by vux984 (928602) on Tuesday December 23, 2008 @04:06PM (#26215419)

      What is the long tail? The summary, and TFA (I skimmed it so maybe I missed this) seem to indicate that the long tail theory means the more obscure stuff will be more popular.

      The long tail theory is:

      1) More obscure stuff will be more profitable (because distribution costs are down - you can distribute electronic goods for practically nothing, and even real goods are more profitable because you can keep them in a warehouse in Wisconsin instead of taking up premium shelf space at a retail store downtown NYC)

      2) Because its profitable, people will actually carry it.

      3) Because people will carry it, people that actually want it will be able to find it and buy it.

      4) Because people can find and buy the obscure stuff they want they'll spend less on the popular stuff they don't want as much. So the blockbusters will lose some of their sales to the obscure stuff.

      In reality, this doesn't seem to be happening.

      • Re: (Score:2, Insightful)

        by sfsp (655361)
        My personal experience is that the part of your thesis that isn't happening is Step 4:

        4) Because people can find and buy the obscure stuff they want they'll spend less on the popular stuff they don't want as much. So the blockbusters will lose some of their sales to the obscure stuff.

        It seems to me that blockbusters are getting bigger, AND the tail is getting longer. More money is being spent at both ends of the curve. This would imply that the curves in the New Scientist article graphic are incorrect: the long tail isn't stealing dollars from the blockbusters. It's not a zero-sum game.

        Of course, throw in a tanking economy and all bets are off...

        • by vux984 (928602)

          My personal experience is that the part of your thesis that isn't happening is Step 4:

          Yes. Precisely. The first 3 are all happening. Its just #4 that isn't panning out.

          It seems to me that blockbusters are getting bigger, AND the tail is getting longer. More money is being spent at both ends of the curve.

          Yes, to both the tail is getting longer and the blockbusters are getting bigger.

          This would imply that the curves in the New Scientist article graphic are incorrect: the long tail isn't stealing dollars from

        • by badasscat (563442)

          It seems to me that blockbusters are getting bigger, AND the tail is getting longer.

          Except that the top albums now sell a fraction of the number that the top albums used to. Ditto for books. Movie blockbusters have not been hit as hard but they have been hit (revenue might be up, but ticket sales are down). So yes, #4 is happening, along with all the other numbers in that list.

          The Long Tail is real.

      • Re: (Score:2, Interesting)

        by Anonymous Coward

        The above summary really is not correct. The "long tail economy" merely means that obscure tastes can be satisfied by the market if distribution and storage are low enough cost. Using an anecdote, I have a friend who sells light switch wall plates. These items are very decorative and are intended to replace the plain ones you can find in any hardware store. However, the market for such decorative items is small. Most people are content with the simple and functional ones that come with the house. If this st

    • Re:Definition (Score:5, Informative)

      by routerl (976394) on Tuesday December 23, 2008 @04:08PM (#26215451)
      Picture a graph: the y-axis is popularity (i.e. numbers sold) and the x-axis is products (e.g. each point is a book). If all the most popular products (e.g. Harry Potter) are closer to the y-axis, and as you move away from the y-axis popularity decreases, you get a long tail on the graph.

      The idea here is that stocking, e.g., a few copies of a LOT of relatively unpopular books, allows you to cater to niche markets and can significantly increase profits compared to only carrying products that are in high demand.

      Companies like Amazon are masters at exploiting the long tail. Oh, and here [wired.com] is the original article describing this idea.
    • Re: (Score:2, Informative)

      by kkffjj (1339025)
      spuke4000 - you are correct in what you do say: "I thought it simply meant that you could make money off the obscure stuff when your distribution costs went to zero (because of the Internet)." you are missing part of what the "longtail" means. It's not really that you "can make more money off the stuff" because before your costs went to zero, you had to make decisions not to sell stuff below a certain point in the tail. Not only has the stuff in the long tail become cost effective to sell, but (and this i
    • Many long-tail proponents argue that the two meanings you discuss are related: when distribution/stocking costs for obscure works go to zero, it can be profitable to stock/sell them, and therefore they will actually be stocked/sold by online retailers. Since this makes the works much more readily available than previously, their sales will (collectively) go up.

      The hypothesis is that the reason the top N works account for such a large market share traditionally is at least in part the practical problems with

    • Re:Definition (Score:4, Informative)

      by JustinOpinion (1246824) on Tuesday December 23, 2008 @04:27PM (#26215667)
      The summary sorta implies that "The Long Tail" means that the unpopular stuff will be more popular. But that isn't the theory, and TFA does a decent job explaining it. "The Long Tail" instead means that if production and distribution costs are low enough, a whole variety of niche products suddenly become viable. Traditionally people could only buy one of the top-10 books (or DVDs or whatever), because stores couldn't afford to stock anything but the best-sellers. But things like Amazon allow them to "stock" just about everything: so a previously untapped market appears, with stores catering to all of these niche buyers. The idea is that the potential in the long tail is massive: nothing in it is particularly popular or sells that many copies, but in aggregate it can be huge (maybe even bigger than the "best sellers"). This model has clearly worked for places like Amazon. Another stereotypical example is customized shoes or clothing; whereas traditionally you could only buy the shirts you saw at the local store, with the Internet you can buy all kinds of more niche styles. In fact, you can buy shirts that have user-chosen slogans or logos. The plethora of online stores that offer these services, or which capitalize on short-lived Internet memes by selling associated clothing, shows that this idea has merit.

      The article notes that despite the long tail, we still have blockbusters. This isn't really in conflict with the theory of the long tail. Indeed the theory mostly talks about the (previously untapped) potential of the long tail... but blockbusters will always exist. TFA says that despite niche markets, most of the sales, and most of the money, still comes from the best-sellers or the blockbusters.

      I think (part of) the explanation for this is from free content. I think that anyone trying to capitalize on the long tail will have a hard time competing with amateurs, enthusiasts, and free information. For mainstream content (e.g. a generic action movie), amateurs won't be able to compete with the budget and brand recognition of established studios. But for niche interests, amateurs will often be producing the "best content" and giving it away for free, making it impossible for commercial interests to capitalize on it. Think about the variety of niche blogs, forums, wikibooks, YouTube channels, creative commons music or books, and so forth.

      So I would say that the long tail exists, and is healthy... but is harder to monetize than some people may have thought. The fact is that niche interests exist, but those niche communities are often finding that they can satisfy their needs themselves, leaving no room for commercial entities to capitalize.
    • Am I missing something, or does the article interpret the idea of the long tail incorrectly?

      People who write for a living have to generate controversy because it youe write an article that reads "what we though all along to be true is in fact true" no one would read it. What the author did here was to miss-interpret "long tail" in a way such that he could show it does not work. That way he gets to write an article with a surprizing conclusion. It's an old trick.

      The way to PROVE "long tail" does not work

      • But Amazon (today at least) does carry a bazillion titles and we can assume they do because they make money doing it.

        Yes and no - The long tail argues that obscure books sell better now because of the long tail - But that's not really the case. Pre-Amazon if you wanted an obscure book you could still get it. The book shop just ordered it in and a week later you got it. Amazon's really no different. What the long tail argues is that obscure books would sell better, but they're not, because people st

    • by gilgongo (57446)

      Am I missing something, or does the article interpret the idea of the long tail incorrectly?

      Like a lot of "big, simple ideas" it's rather open to interpretation.

  • by Anonymous Coward on Tuesday December 23, 2008 @03:39PM (#26215117)

    A summary that told me so much, yet so little.

    "Long Tail theory" No idea. Apparently I missed an article somewhere.

    "flatter and thinner" I gotto admit, tails in an evolutionary sense popped to mind here for some reason. Though the mention of markets made that an obvious red herring.

    "blockbusters are not going away" Aha, movies!

    "widely used collaborative filtering software is magnifying the winners' share of the various pies" Say what?

    • by ZygnuX (1365897) on Tuesday December 23, 2008 @04:09PM (#26215469)
      The guy who made the summary is the perfect politician. Able to fill a summary with words... but without saying anything!
    • by glwtta (532858)
      For some reason article submitters here really like to reference obscure concepts without definition; I think we're supposed to be in awe of their erudition.

      "What do you mean, you are not familiar with Long Tail theory? Why, such a possibility never entered my mind, seeing how I know it so well!"

      Gets tiresome, since the only result is that we end up clicking through to articles we have zero interest in.
  • by Dr_Barnowl (709838) on Tuesday December 23, 2008 @03:46PM (#26215183)

    Of course they want to sell you new media. Old media has the unfortunate quality of being old. Should copyright extension insanity ever end, old content is closer to becoming free content.

    If they can induce you to fill your time with new, "premium" content by splashing adverts at you and skewing selection algorithms on Amazon and the like, they will prefer to every time. New stuff commands a higher price. New stuff has higher margins. New stuff keeps the media industry running, and they have clout.

    Old stuff is, like, yesterdays stuff. Even if it's better.

    • It's not even about new vs old. It's about the specific item that "they" want you to buy. It's much more profitable to invest in and sell one big blockbuster than it is to invest in and sell several moderately popular items. In short, they want us back playing their game.

      I for one have often browsed the shelves of airport bookstores and have walked out disgusted every time because I can't find anything worth reading. I've even passed up classics because they only stock the most poorly done translatio
    • I thought "new media" referred to how the content was delivered. Not the fact that the content itself was actually new. "Pride and Prejudice" on a Kindle would be new media, whereas the latest Paul Krugman column on ink-spattered parchment would not.

  • by Vellmont (569020) on Tuesday December 23, 2008 @03:58PM (#26215333)

    It's pretty silly to expect that everyone is going to change their behavior immediately due to increased availability of a larger variety of goods. When cable came along and people were given a larger amount of choice of television programming viewing habits didn't change overnight, they changed over decades.

    People are creatures of habit. It'd be more interesting to see if the variety of goods people buy varies with age. If so, expect that "long tail" to eventually appear as the population turns over.

    • by cdrguru (88047)

      Interesting, comparing it to cable TV. What a lot of people do not know is that most of the niche cable channels (think Golf Channel) aren't very profitable. They still exist because they managed to get themselves listed with the cable company and this guarantees them revenue, regardless of actual viewing habits. The ad space is really cheap as well, and this attracts certain types of marketers.

      What happens if we get total ala carte channel selection where everyone gets to decide if they can receive the

      • You picked an unfortunate example. I worked at a satellite company for a while and the Golf Channel was one of the moneymakers. People would upgrade their package to get the Golf Channel. The only more popular nonpremium requested channels were Fox News and AMC.

        I didn't work on the financial side, but I bet they could tell you how it all breaks down. I know one thing for sure, every channel had dedicated viewers. Even one of the shopping channels would trigger an avalanche of calls if it lost the feed
    • Don't forget the biggest sin that an American can make... "Though shall not get ripped off." If you get ripped off then normally you are the one who is mocked at. Going with named brands at least helps insulate you from getting ripped off. Hey Ill buy this Xerox Printer vs. a Samsung. I may pay an extra $100 for it but hey it is a Xerox not a cheap Samsung... (even if samsung had made the printer for xerox) you are insulated from ridicule. If the samsung crapped out you should had gotten the Xerox. If the

    • Missed the point (Score:4, Interesting)

      by characterZer0 (138196) on Tuesday December 23, 2008 @04:37PM (#26215791)

      The habit (of wanting what everybody else wants) is not waning as selection and availability increase. The habit is reinforced by the increasing channels by which we can see what everybody else wants and adjust our own wants to that.

      The Internet, while logistically making the long tail feasible, is socially making blockbusters bigger.

    • It's pretty silly to expect that everyone is going to change their behavior immediately due to increased availability of a larger variety of goods. When cable came along and people were given a larger amount of choice of television programming viewing habits didn't change overnight, they changed over decades.

      Hint: It's 2008 - and that increased availability has been around since 1996 or so (a decade plus). You'd expect the effect to be showing even if it's not yet general - but it isn't.

  • by fermion (181285) on Tuesday December 23, 2008 @03:59PM (#26215341) Homepage Journal
    I believe this, not the headline, is the crux of the article

    OTOH, it is clear that the way to make a lot of money as a retailer is to have the popular options at a low price, a la Wal Mart. As the article suggests, though, have a few niche items can make money, if you can get people to pay for therm.

    Here is what I think. Stocking an item, even a virtual item, incurs a cost. So if one stocks a million different items, and only one thousand different items moves a week, then there are costs not being covered on an even yearly basis. One way to make this work it mark up items a lot, as in the used book store, wher a book can be bought for a dime and sold for a dollar.

    To me the long tail means either selling in a high markup niche market, or having the ability to control costs so you can sell less of more different things and actually draw a profit. In either case, the long tail in going to be chanllenged in times that force are going to force some fiscal responsibility, and people are going to focus on necessities and cheap luxuries.

    • But if the cost of stocking a virtual item is low enough, it may be worth carrying a thousand products in the hopes that one or two of them garner a single sale.

      For example, say that the cost of maintaining a single song is (to pull a number out of the void) .1 cents a year, while the profit to the store for selling one song is 50 cents.

      Given those numbers, one sale from one obscure song could support the inventory cost of 500 slacker songs for an entire year. Since you don't know which of the non-selling

  • Could it be that because of the bad economy those things on the farther ends of the tails which were more cheap and more available before aren't so anymore?
  • The thing about the long tail theory is that, on the flat end of the curve, you have very small overall returns, and a lot of other people making products with the same low capital and similar returns. so, basically, you have a lot of sucky stuff, then, a few things that are actually pretty good. You can see this with windows shareware as much as you can with web sites or anything else. A lot of stuff sucks, and only a small amount of it is actually good.

    • Yes, yes. 90% of everything is crap. Maybe in Long Tail world, 99.9% of everything is crap. What's the point that you're trying to make?

  • Clueless (Score:4, Insightful)

    by mcgrew (92797) * on Tuesday December 23, 2008 @04:04PM (#26215403) Homepage Journal

    from the comments, the "long tail theory" is misunderstood by most slashdotters (at least, the few who are showing up today, most of whom, it seems, are in my "freaks" list judging from the comment moderations).

    TFA was incredibly bring and unnecessarily wordy, as if the author had little to say and vast tracts of text to say it in.

    Wikipedia refers to:

    1. The Long Tail, a consumer demographic in business
    2. Power Law's long tail, a statistics term describing certain kinds of distribution
    3. Long-tail boat, a type of watercraft native to Southeast Asia
    4. Long-tail distribution, a probability distribution is one that assigns relatively high probabilities to regions far from the mean or median.
    5. Long-tail traffic, telecommunication traffic that exhibits a Long-tail distribution

    Obviously it's not referring to a boat or telecommunbications traffic. What it does refer to is a statistical curve on a graph. Take IQ. If your IQ is 100, you are on the top of the bell curve, the median. If your IQ is over 150 you are close to the extreme end of the "long tail".

    The phrase The Long Tail [wikipedia.org] (as a proper noun with capitalized letters) was first coined by Chris Anderson in an October 2004 Wired magazine article[1] to describe the niche strategy of businesses, such as Amazon.com or Netflix, that sell a large number of unique items, each in relatively small quantities.

    The concept of a frequency distribution with a long tail -- the concept at the root of Anderson's coinage -- has been studied by statisticians since at least 1946.[2] The distribution and inventory costs of these businesses allow them to realize significant profit out of selling small volumes of hard-to-find items to many customers, instead of only selling large volumes of a reduced number of popular items. The group that purchases a large number of "non-hit" items is the demographic called the Long Tail.

    Given a large enough availability of choice, a large population of customers, and negligible stocking and distribution costs, the selection and buying pattern of the population results in a power law distribution curve, or Pareto distribution. This suggests that a market with a high freedom of choice will create a certain degree of inequality by favoring the upper 20% of the items ("hits" or "head") against the other 80% ("non-hits" or "long tail").[3]

    The theory is that if you have warehousing costs, it isn't profitable to stock items that don't sell well. On the other hand, if your warehousing costs are zero, any sale is profitable.

    The article (what I read of the boring thing) didn't say much of anything except "stuff one person will buy won't outsell stuff millions of people will buy"

    In short, DUH. hardly profound.

    • by fruey (563914)

      I'm not sure. I think that what it is saying is that, rather than being able to sell low volumes of stuff that you couldn't sell before, in fact you can't. You'll actually just sell a bit more of the stuff you sold very low volumes (or you didn't stock) before, but there's no magic new stuff that sells at low volume on the net.

    • Re:Clueless (Score:5, Insightful)

      by swillden (191260) <shawn-ds@willden.org> on Tuesday December 23, 2008 @04:42PM (#26215837) Homepage Journal

      The article (what I read of the boring thing) didn't say much of anything except "stuff one person will buy won't outsell stuff millions of people will buy"

      In short, DUH. hardly profound.

      Well, it's hardly profound if you oversimplify it and misstate it.

      The idea behind the long tail was that the massive variety that on-line retailers can offer, as compared to brick and mortar retailers who have severe shelf-space constraints, would lead people to find and buy more obscure stuff.

      No one really expected the obscure stuff to outsell the popular stuff, but there was an expectation that some of the dollars formerly directed to popular stuff would get spread instead across the more obscure stuff. This would cause the sales of popular stuff to flatten a little and the "long tail" of obscure stuff to thicken a little.

      That seems pretty reasonable on its face, but it's apparently not what happens.

      It appears, in fact, that without the friction imposed by retailer shelf-space decisions the blockbuster effect is enhanced. When millions of products are available, people pay even more attention to peer recommendations, and that drives a more powerful blockbuster effect. The use of automated popularity-based recommendation software probably adds to the effect as well.

      Is that profound? You decide. I think it's at least interesting.

    • Re:Clueless (Score:4, Interesting)

      by ZombieWomble (893157) on Tuesday December 23, 2008 @05:05PM (#26216081)
      While your point is somewhat valid, you're missing the crux of the argument presented in the original Wired article, which went somewhat beyond the simle "smaller costs make rarer sales profitable"

      The idea was not only that the internet would enable sellers to tap into this market more effectively (through lower costs) but also that this would in turn lead to the tail becoming yet larger (both because increasing number of items sold means more potential sales, and because these rarer items may pick up additional momentum and sell more copies, thus giving more events with higher frequencies) as compared to the "blockbuster" events, which suffer due to increased choice.

      More specifically, the issue is not "stuff one person will buy won't outsell stuff millions of people will buy" but rather "will many items purchased by a few people exceed the sales of a few items purchased by many people", given improved choice. The long tail hypothesis as presented in the Wired article says yes (or, at least, that the few-selling items will gain ground in the scenario presented by the internet) but evidence in this article says no. Perhaps still not the most shocking discovery in the world, but certainly a bit more than the trite discovery you make it out to be.

      Also, as an aside, IQ is a very bad choice to illustrate the "long tail" because IQ is by definition normally distributed, and thus has a relatively short tail, as such things go - a long tail distribution is typically characterised by a significant slowdown in falloff as you move further from the median.

      • Re: (Score:3, Interesting)

        I'm not sure how convincing the article's evidences are. For example, a study that says 0.4% of an online catalog are responsible for 80% of sales sounds damning. But where is the traditional sales outlet with 13 million items for us to compare it to?

        I believe Wal-Mart stocks about 5000 CDs, or about 50,000 songs. That's roughly equivalent to the 52000 songs that constituted 80% of the online retailer's sales. But in Wal-Mart's case, 50,000 songs generate 100% of sales. So the dredges of that online ca

    • Please quit quoting the discredited studies on IQ as a bell curve - it gets used by the wrong kind of people to promote the worst kind of racism. There was a widely distributed book (unfortunately) that advanced this theory, and it served no purpose other than to justify the comfort of people in power. In a just society, this book would have been suppressed (by legal means, i.e. no publisher would have taken it) but in the USA, it's business as usual, anything that bashes brown people is instantly popular
  • Seriously (Score:4, Insightful)

    by Thelasko (1196535) on Tuesday December 23, 2008 @04:06PM (#26215423) Journal
    are you going to sit at your computer and listen to every sample iTunes has to offer and pick out the ones you like best, or are you just going to buy what your friends recommend?
  • I don't think so (Score:5, Insightful)

    by the eric conspiracy (20178) on Tuesday December 23, 2008 @04:07PM (#26215439)

    The markets studied in this work are notorious for being driven by short term fads. Online downloads are by predominantly ephemeral pop music, and a study of 14,000 teenagers? These are the people most influenced by peers and the 'so last week' attitude, They haven't had the time to explore and broaden their outlook.

    Try getting a more diverse sample and I think that the long tail will look a lot fatter. People in their 30's and up have had time to develop far more diversified tastes and will have much more eclectic buying habits.

    Pick a cohort of 14,000 boomers and you will see something very different.

    • by fruey (563914)

      Good point, I think that boomers (and niche sites that sell for pennies / give stuff away) are the long tail, and that is absent from classic retailers - even Amazon.

      There is a good point about how Amazon do have a lot of stuff that just doesn't sell at all though. People still flock to what is popular, basically.

  • by greg_barton (5551) <<moc.oohay> <ta> <notrab_gerg>> on Tuesday December 23, 2008 @04:10PM (#26215483) Homepage Journal

    There's a certain segment of the population that enjoys finding obscure stuff. I'm not sure of the size, but I'd guess it's about the same size as the introverted [wikipedia.org] segment of the population, around 25%, as the two behaviors are somewhat correlated. (i.e. folks who actively stray from the herd socially are more likely to express interest in consumables that are different from the herd's preferences) So, given that assumption, the drivers of a long tail market, "funky stuff seekers," could be overpowered by the general population.

    On top of that, it's my guess that researchers in this area, as researchers in most areas, tend to be "funky stuff seekers" themselves. (I mean, it's their job to search and speculate on the edge of their field of study.) So, right off the bat, there's a bit of inherent bias in interpreting the effect of their cohort on the market. In other words, they're following the non-herd herd. :)

    • by eth1 (94901)

      But all of the buyers of obscure stuff don't need to be funky stuff seekers. One funky stuff seeker could introduce the funky stuff they find to the others that might buy funky stuff, but not actively seek it out.

  • Doubts geometrically increase about the "long tail" :)

  • by sac13 (870194) on Tuesday December 23, 2008 @04:30PM (#26215711)

    The article was generally ok, but clearly not completely understanding of what the "Long Tail" means. Of course, from what I've read (including the book itself) the interpretations and applications of the theory are rather fluid anyway.

    The biggest issue I have with the article is that it seemed to be conveying that the "Long Tail" meant an end to blockbusters. It doesn't mean that at all. It just means that there's enough business in the "Long Tail" to make it profitable to sell items that weren't blockbusters given the low cost structures of Internet retailing. Amazon and iTunes both make hundreds of thousands of dollars monthly on items that only sell 2 or 3 copies. With traditional retailers, space is a limited commodity and must be devoted to items that will sell in enough volume to justify carrying them.

    Now, IANAPhd, and the article quotes quite a few that seem to disagree with the idea of the "Long Tail", but it seems the evidence they discuss is rather weak. Yes, people are influenced by others in their choices. Much of this comes from the vast history of humanity and our tendency to form social groups. The Internet has yet to truly begin to change humanity in the ways that it will. The key thing with respect to the article is the definition of what our peer groups are. Despite the global nature of the Internet, most of our peer influence is local. As more and more people around the world connect and begin to actually talk to others outside their current peer groups, those peer groups will expand and change. That is going to be a key driver in generating the diversity that the "Long Tail" predicts.

    The "Long Tail" is only beginning because humanity's experience with the Internet and the interconnectedness that it brings is only beginning. Just because it hasn't completely happened doesn't mean that it's not happening.

    • The Long tail is snake oil; wishful thinking encapsulated in a sound bite. Mr Anderson has certainly demonstrated how to profit from the "Long Tail", however the business model is really restricted to just himself.

    • Actually, the Long Tail does predict that, because the obscure stuff is now available, that stuff will sell, and such sales will probably eat into the success of the blockbusters. It also expected that sub-sub-subgenres would develop and attract small communities, which would take money and attention away from more mass-appeal material.

      It may be happening. It may not be happening. It may just be taking longer than some expected. The evidence does seem preliminary at best.

  • by Sique (173459) on Tuesday December 23, 2008 @04:57PM (#26216007) Homepage

    ... also known (in a simplified form) as "Zipf's Law". The most popular word occurs twice as often as the second popular, three times the third popular, four times the fourth etc.pp.

    If you look at the 10% most popular words in a table, you will notice that the absolute share of the upper 10% increases, if you count longer and longer texts with more and more individual words.

    With 10 different words you get, that the first 10% make up ~34% of all words.

    With 100 different words you get already ~56,5% share for the first 10% of words.

    With 1000 words we have 69,2% share for the first 10%, with 10000 we come to ~76,5% share.

  • It seems that most /.'rs are missing the point entirely. The Long Tail is not about making an obscure product popular, or about making blockbusters less popular. It's about being able to make a lot of money selling a very few copies of each of a lot of different titles. It's based on the assumption that the population has become so large that a even tiny percentage of people that like a given title is still a large number, and that there are a ton of tiny percentages, "micro niches", if you will, that in
  • Warez (Score:3, Insightful)

    by retech (1228598) on Tuesday December 23, 2008 @05:04PM (#26216071)
    The internet does not increase taste. It may increase choice, but the tastes of people remain the same. If you appeal to the lowest common denominator you flood the market.

    Case in point, warez sites. Troll them for 30 minutes and you'll be hard pressed to NOT find a flood of the same 10 movies, CDs, books etc. Even when stealing the product people do not go for the avant-garde or the art house, they go for the same 10 things that are hot.. NOW. Yes, you can find the other obscure stuff, but you have to dig long and hard for it. And in the end, it's the same very small circle of people that do that. The masses want what they want. It's called MASS APPEAL for a reason.
  • The usual formulation of the long tail thesis is that sales volume for items follows a zipf distribution. I didn't see anything in the article to contradict that.

    The article holds up the continued existence of blockbusters, like Harry Potter, and evidence against the long tail. However, there must be blockbusters in a zipf distribution--otherwise it isn't zipf.

    Every retailer truncates their own tail at the point where sales volume becomes too small (relative to fixed costs) to be profitable. Anderson's orig

  • FTA:

    Watts thinks that the films we watch or the music we listen to is not entirely, or even mostly, about the thing being consumed. It is about the social context in which we consume it. "If you're dating a girl who likes AC/DC, you might start listening to AC/DC. With another girlfriend, you might be listening to Aerosmith," he says.

  • "Word of mouth" spreads faster on line and so something popular can snowball bigger faster and faster in the internet age. The fat part of the tail.

    But the net also allows people with unique tastes to find unique objects to satisfy them. That is the long thin tail.

    I personally hate shopping at the modern American mall where I get to pick which of 6 different retailers I buy the same product from. Who thinks that is about choice?

  • by IGnatius T Foobar (4328) on Tuesday December 23, 2008 @05:30PM (#26216313) Homepage Journal
    The long tail is alive and well. I think some people seem to have gotten the crazy idea that implementing it meant that you'd have an automatic win. In reality, most of the basic rules of business still apply. You still have to deliver a quality product at a fair price, you still have to provide good service and a friendly buying experience ... in short, you can't be a piece of crap e-commerce company and still expect that the world will beat a path to your door simply because you offer a huge selection. Amazon got it right. iTunes got it right. The basic premise of Long Tail still holds water: if you can connect a near-infinite number of buyers with a near-infinite number of selections, then you don't have to be the market leader selling the big blockbuster hits in order to turn a profit. But you can't suck either; Long Tail doesn't change that.
  • Perhaps what the Long Tail Theory postulates is that people will somehow stop having a herd mentality once their experiences can be tailored on a whim. However, given that man is a social animal, I don't know whether (or how much) this change will occur.

    Personal observation has been that people simply don't have the time these days to dig deeper. Pardon my acting a bit ignorant, but just as many people do not examine their own actions and lives, so too do they not examine many of the things they consume. Pe

    • Your observations match mine.

      The thing I find most. . , curious, (I almost said 'maddening') is that I find the same forces live strong inside me. When presented by an obviously superior idea, my first instinct is to look around to see who else is using and benefiting from it. If nobody, then fear and doubt set in and it takes a shit-load of internal chutzpah herding to bring myself to jump. Then, even after it works and life gets that much better, I find I still actually have to sell the idea to others,

  • Music is a tough business since music taste is built by repetition. Certainly though Pandora has expanded the range of music I listened and introduced me to groups that I would like but didn't know about. Classic long tail.

    But Pandora doesn't sell music. iTunes conversely I don't buy from anymore after annoyance with their DRM. It looks like Pandora/Amazon cross links are starting to work better and then we'll see about the long tail.

    • In my experience Pandora pushes me closer to the mainstream. It does have very obscure music on it, but as I make choices about what I do and don't like from a starting point, I always seem to end up listening to Pat Benetar or The Beatles. Which I like, but I already know I like them. I grew up listening to them.

      • by jbolden (176878)

        My experience is the opposite, I start with (the equivalent of) Pat Benetar and it ends up suggesting some German rock group that sound just like her. And pretty quick I'm into this German group and....

  • Anyone wanting to get a better understanding of this needs to read around [shirky.com] a bit more.

    "... inequality can arise in systems where users are free to make choices among a large set of options, even in the absence of central control or manipulation. Inequality is not a priori evidence of manipulation, in other words; it can also be a side effect of large systems governed by popular choice. ... the debate on media concentration can now be sharpened to a single question: if inequality is a fact of life, even in di

  • I worked for Warner Music Group a number of years ago and it was common knowledge that a *very* small % of the catalog was responsible for most of the profit (I no longer recall the numbers). The fact that the long tail doesn't apply to the music industry hardly seems like news to me.
    • A) If I'm looking for obscure music, why would I go looking in Warner's catalog? With one exception, none pf my obscure music is owned by a large label, and frankly, fiinding the piece that was took a long time.

      B) How much of Warner's Catalog is even available? The average is less than 4%.

  • by Dr. Spork (142693) on Tuesday December 23, 2008 @09:50PM (#26218743)

    I remember years ago when porn customers were happy enough to see a video of good looking people having sex. Now I have the impression that entire companies are surviving off the money of "long tail" customers who want to see shemales fuck midgets inside of a walk-in freezer.

    And as we all know, where porn goes everyone else follows.

What this country needs is a dime that will buy a good five-cent bagel.

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