• The Long Tail Chapter discussions

Introduction (Maria)

The hits used to rule, but not anymore. Hits have lost their appeal and do not use to sell as much as a few years ago. Today, a teenager has grown up with the internet and does not differentiate between hits and what he likes. There is an enormous amount of choice he/she can pick from. Netflix, Amazon, iTunes are a few samples of aggregators on the web that have made possible this. The 80/20 rule does not rule anymore giving up its space to the 98% rule of the long tail: most of the products of these aggregators are sold at least once in a quarter. The charts of online distributors’ sales have the shape of a curve that flattens at the bottom ("the long-tailed distribution"). The hits will keep selling and will be at the top of this curve (the head of the tail), but the tail will stretch in a continuous flat long tail.

Summary Chapter 1 - How Technology is Turning Mass Markets into Millions of Niches (Maria)

The Internet has made possible to turn markets into infinite niches. The power of the Internet stands in distributing and organizing information. Thanks to filters, products that might have difficulties in getting distributed can be found on the Internet nowadays. The Internet stimulates demand and puts together suppliers and markets at a minimal cost. This is the case of Touching the Void, a book published about 10 years ago. The book was shown to the people who had purchased the recent Into Thin Air publication outselling it in a few weeks. The Internet breaks the geographically boundaries: you do not have to physically go anywhere to buy something and everything is available at your fingerprints. Not everything is available at your local retailer because of space constraints. Chris Anderson sharply calls it the world of abundance of online distribution opposed to the world of scarcity of mass markets.

Summary Chapter 2 - The Rise and Fall of the Hit (Diane)

This chapter basically says that before the Industrial Revolution and invention of mass communication, culture was local, kept that way by the difficulty of traveling and spreading word around to other areas. But once radio, TV, and other mass communication was developed, our culture changed and homogenized to a certain degree - and these industries became very influential in shaping our tastes and likes. But as the 21st century issued in, things started to change - first in music, with radio, television, newspapers, magazines and movies following suit. Practically every sector of mass media and entertainment has been affected as sales plummet and listener/readership levels decline. Blame has been attributed to such things as file-sharing and downloading, iPods, TiVo and DVRs, and cell phones. Now, individuals are forming new tribes and communities based on shared interests and our own individual tastes, not on geography, broadcast schedules and what corporate executive tell us to like.

Summary Chapter 3 - A Short History of the Long Tail (Heather)

This chapter charts the origins of the Long Tail via a string of business innovations in the ways we make, find, distribute and sell goods. The roots of the Long Tail go back to the late 19th century and the first giant centralized warehouses which ushered in the era of massive choice and availability. Then Sears, Roebuck & Co began the first catalog distribution which brought variety and low-priced items to rural farmers. When the urban population began to outnumber the rural population in the 1920s and city shoppers preferred stores to catalogs, Sears opened superstores with the same huge selection and low prices. The same thing happened with food in the 1930s with the first supermarket King Kullen. The next great expansion in variety took place with the introduction of toll-free 800 numbers in 1967 by AT&T which enabled the return of catalog shopping. This later wave of catalogs was more about targeted niches. E-commerce started in the early 90s with Amazon by building on the catalog model with even more convenient ordering, larger selections and broader reach at lower cost. Today online shopping has passed catalog shopping and accounts for about 5% of American retail spending, growing 25% a year.

Summary Chapter 4 - The Three Forces of The Long Tail (Betsy) 

Thanks to the internet, the Long Tail has emerged due to three forces working together in today's culture and economy: Democratizing the tools of production - With individuals now having the power, technology and access to goods and services, that only companies had before, the individuals can now produce more products and services to compete with larger companies, which ultimately levels the playing and allows individuals to produce more available goods which grows the long tail exponentially.  Democratizing Distribution - Thisallows for more access and cheaper access to goods and services which makes niche products available and in turn, grows the "tail".   Connect Supply and Demand - With this growing supply of goods, there needs to be a demand, so what drives the demand is consumers hearing about the products through word of mouth, blogs, customer reviews, best-seller lists, which ultimately "lowers the cost" to find content and allows and entices consumers to buy more products and buy products that may not are not as well known.   

Summary Chapter 5 - The New Producers (Lea)

The main discussion on the chapter is about the difference, if there is any, between professionals and amateurs works. The author uses “Pro-Ams” comparisons to illustrate the creation process seen nowadays, when consumers have the full access to the tools of production of movies, books, encyclopedias, music etc. It is the shift from being passive consumers to active producers, for example: amateur blogs are sharing attention with mainstream media; small time bands are releasing music online without a record label.

The other example, well explored in the chapter, is about the wikipedia phenomenon– collective wisdom of millions of amateur experts, semi-experts and just regular folks who thought they knew something.  As oppose to the traditional Encyclopedia – compilation of scholars authoritative knowledge.

All of this reflects the change of a once-monolithic industry structure where professionals produced and amateurs consumed to a two-way marketplace where anyone can be in any camp at any time.

Summary Chapter 6 (Huey-Min)

This chapter takes us to new markets beyond the traditional marketplace by introducing the concept of aggregator that can stretch form head to tail, thus creating in the process three business models of opportunities.   One, a traditional physical retailer that has a physical address with inventory requirements can only carry a limited number of products.  The selection will cover pretty much only the head of the curve and there will be no room for a long tail, as there is a physical constraint as to how much space is available and a monetary fixed cost that is not minuscule associated with each inch of the physical  retail space. The example of Tower Records is cited.  Second, the hybrid retailers.  They are the ones that sell physical goods online, tapping into the long tail opportunities, offering inventory hundeds of times greater than their brick and mortar conterparts but eventually hit a limit.  Examples are: the online retailers of physical goods like BestBuy.com, Netflix's DVD library, Amazon.com.  Third, pure digital retailers selling only digital goods online. This last business model offers endless long tail opportunities as the costs of carrying digital files are minimum.  Examples: itunes, Rhapsody.  Getting rid of physical inventory altogether, except in bits, saves tons of costs.  This chapter explores the concept of inventory on demand and getting rid of inventory altogether as the way to a long, long tail.   

Online distribution has two major effects: it widens the field of possible customers and shortens the search time resulting in increased sales and growth of the overall market.

Summary Chapter 11 (Allen)**

The evolution of the ‘Disco’ culture of the 1980 is a perfect example of Long Tail economics. The most significant aspect of the rise of house, a variety of music, is the bankruptcy of blockbuster culture and the emergence of vibrant, diverse, culture of its own. Affordable technology allowed for the democratization of the tools of production of music as well as music trends. Djs were progressively emancipated from traditional music constructs of production unleashing a plethora of small indie records. With this trend emerged filter entities which suddenly has access to low barrier of entry channel distribution. Whereas traditional media would blanket relevant as well as irrelevant content to wide audiences without real time feedback, Djs and the likes received immediate access to how their small markets reacted to the information-their music. Label became the authority not the tracks, 180 degree change. This complexity gave rise to labels as a means of tagging-a Brand so to speak. The multiplication of this effect meant the cheap abundance and distribution resulted in varied vertices of interest. That said, people did not stop listening to hits, they became characterizes by what is referred to as ‘AND’ and ‘OR’ culture. At any given point in time, a consumer would share the mainstream experience but can now also cheaply reside in niche markets. En fin, what this showed and what the chapter refers to as ‘my tribe is not always your tribe, even if we work together, play together, and otherwise live in the same world. Same bed, different dreams.” The democratization of information means that culture is no longer treated as one, but as interwoven worlds connecting at times to one group and disconnecting at times from others. This is nothing new, what is new is the means to technologically act on it. So we now enter into an era where ‘we’re leaving the water cooler era, when most of us listened, watched and read fro the same, relatively small pool of mostly hit content. And we’re entering the micro-culture era, where we’re all into different things.

These changes are profound mirrored par excellence in the news landscape shift. Whereas news organization dictated what was important and what was not, blogger and internet aficionados now capture much more efficiently and with a high level of plurality realities than these news organization, and in many respects become the source authority (blogs, websites etc….).

The polarization of the news landscapes begs the question that if news is ‘niched’ what then happens to art, literature, music? Is it that society as we know it as a ‘common experience’ seizes to exist or is it that a new kind emerges. The authors supports the pretence that a complicated interactive matrix arises by what he refers to in the movie industry as ‘classics one month and going to sci-fi bender the next.” He concludes by stating that we are not so much fragmented as we are re-forming along different dimensions.