Yesterday music industry pundit Bob Lefsetz shared an excerpt from Anita Elberse's new book "Blockbusters" that seemed to be posted as a criticism of Chris Anderson's concept of "The Long Tail." Whatever his intent, this moment seems a good opportunity to take a look at Lefsetz's coverage of the concept of the long tail over time, since he was a part of the dialogue that surrounded the book's release, and to revisit the actual concept of the long tail as opposed to its many misinterpretations and misrepresentations. Though the concept of the long tail is not discussed as widely as in the prior decade, Anderson's "The Long Tail" remains on my list of top 10 business books for the 21st Century.
Chris Anderson and The Long Tail
For those that missed out, Chris Anderson began public work on the concept of the long tail in 2004 with an article in Wired and plans for a book. He continued a public discussion of the topic via his blog, The Long Tail, where he discussed data points, argued fine points and further developed his application of a statistical concept to ecommerce leading to the publication of the book, "The Long Tail," in 2006.
The New Marketplace from "The Long Tail, in a nutshell"
"The theory of the Long Tail is that our culture and economy is increasingly shifting away from a focus on a relatively small number of "hits" (mainstream products and markets) at the head of the demand curve and toward a huge number of niches in the tail. As the costs of production and distribution fall, especially online, there is now less need to lump products and consumers into one-size-fits-all containers...."
"One example of this is the theory's prediction that demand for products not available in traditional bricks and mortar stores is potentially as big as for those that are... In other words, the potential aggregate size of the many small markets in goods that don't individually sell well enough for traditional retail and broadcast distribution may someday rival that of the existing large market in goods that do cross that economic bar."
Chris Anderson took the statistical concept and explored it publicly for a number of years both before and after releasing his book. His take on the matter was that the web would make it possible for a much broader range of products to be available to consumers any and everywhere and so more stuff would be sold further down the line and more niches would develop.
Whether seen as a flattening of the market or a thickening of the long tail, it was clear that obscure cultural products would have easier access to public markets via the web.
So the web was quite different from mass market retail in which most major chains of cds, books, clothing, etc. simply presented consumers with what they thought would be hits and then responded to consumer behavior in order to keep the hits coming.
Suddenly gatekeepers weren't as powerful, living in the boonies wasn't as big an obstacle and more money could move to smaller producers.
Many spun out the metaphor and concluded things like:
- now tiny niches can be the basis for real careers and businesses
- there will be no hits in the future
- there will be no gatekeepers in the future
But these were misrepresentations of what could ultimately be predicted by the long tail concept as developed by Anderson and his many social collaboraters. However, an early subtitle for the book, "How Endless Choice Is Creating Unlimited Demand," showed that perhaps even Anderson fed into such misperceptions as he worked his way through the possibilities.
A later subtitle, "Why the Future of Business is Selling Less of More," sums up the key thrust of "The Long Tail."
Yes, Anderson's concept of the long tail does say that more products will be available down its length and that more sales will occur due to that availability.
But just because more money moves into a thickened long tail doesn't mean that any one point on that tail will generate enough income for an individual, let alone a business, to be a successful self-supporting entity.
The big idea here is that if you start a business that can aggregate products in both the head (hits) and the long tail (niches), then you've got a great business at this point in history.
Examples of business aggregating the hits and the niches:
- Amazon - sells a full range of hits and lesser known products that could never fit in one store.
- Google - search results aggregate both the top results, which become hits, and the long tail of lesser results.
- YouTube - full range of videos from top stars to footage for friends.
- Facebook - celebrities, you and me plus the total unknowns of the world.
The money is in aggregating the whole thing. The head. The long tail. And, as the concept of the long tail continues to develop, the "torso" as well.
The idea that the long tail meant that small fry would now be able to earn a living was a hopeful leap but the long tail can also fit a scenario where no niches can support anyone. Its predictive power just doesn't support the gushy revolutionary prose that emerged at the time.
Lefsetz and The Long Tail
I've taken a superficial look at Bob Lefsetz's statements about the long tail on The Lefsetz Letter. Due to the limits of time and my own inability to make it all the way through these stream of consciousness excursions, I can't call myself a critic of Lefsetz. But I think his seemingly shifting position is worth a closer look.
In 2006 and 2007, Lefsetz seemed to embrace ideas he connected to the long tail:
"If you don’t think niche will eat away at the dominance of hits, you’ve just never turned on a TV set...All those cable channels? They may not be pulling in many viewers, but they can be OH SO PROFITABLE, with low production costs and high advertising rates to reach their customer base."
"The long tail says that there’s demand for everything, that people want a much wider swath of material than previously thought, and that via Internet distribution, it’s now available and will sell. I AGREE with that. But to say concomitantly that there’s less demand, less NEED for blockbusters, is just patently untrue."
"One thing’s for sure, although these old cats will get paid for music in their companies’ catalogues, they will not rule music in the future. Because not only is production and distribution available to everyone, they just don’t get it. It’s been eight years since the advent of Napster and they still don’t get it. CD sales are cratering around the world and they want to raise the price of product as more people are clamoring for more music at a lower price."
At this stage it appears Lefsetz was drinking the Kool-Aid though also making some solid critical points and enthusiastically using the long tail as a jumping off point for his critique of the major labels.
By 2010 and 11, he's rejected the whole notion as a bill of goods:
"The Long Tail was a myth. In a world where everything is available, people will gravitate to the top, the superstar, the one and only... This is not to deny that there’s a market for niches. But when it comes to concert tours, expect the rich to get richer. And the poor to remain poor."
"Just because everything’s available, that does not mean anybody wants it."
"In other words, you can get your song on iTunes, but nobody other than your mother and your boyfriend might buy it..."
"Now of course the flattening of distribution allows for niches to be populated that were hard to find or get to previously. But don’t expect these niches to blow up..."
"You’ve been sold a bill of goods. Excited by the Net, you bought the words of charlatans, who had no familiarity with art, who thought that the proletariat was now going to triumph."
On the surface, these stances seem to be opposing. Once Lefsetz drank the Kool-Aid. Now he points to the purple drank and says it's tainted and unworthy of consumption.
The funny thing is, he's mostly right at every turn and the evolving concept of the long tail says so!
The Long Tail in the Year 2013
The concept of the long tail that we're discussing is like many such perspectives. It continues to develop over time, accounting for new data points and adjusting to changing realities.
The following ideas developed during the heyday of "The Long Tail" seem to be true today in addition to the core concept of aggregating hits and niches.
Niche interests that seem obscure to many have found their markets via the web at a level that just wouldn't be possible via brick and mortar.
More people are able to earn a living in niches using tools designed to enable long tail creators while bypassing traditional gatekeepers.
More products will become more readily available than before.
It's hard to argue that there isn't lots more music available and that even mainstream distribution outlets like Amazon aren't full of DIY submissions. What discussions of the long tail often didn't include is the issue of limited attention. I think that's one reason Lefsetz posted this section from "Blockbuster."
Hits won't be as big.
The record for lowest selling no. 1 album continues to be broken.
Sales will shift to the long tail.
This is the other point that Lefsetz seems to be refuting with yesterday's quotes from "Blockbuster" that points to an increasing number of tracks selling over a million.
This is a topic worth considering more closely. Since Elberse uses SoundScan data, one would have to consider the increasing number of digital outlets that aren't tracked. On the other hand, some DIY platforms are getting their data to SoundScan so a deeper look is needed (which Elberse may well discuss in "Blockbusters").
Elberse considers sales in the quoted passage and SoundScan data that shows sales in the long tail thinning while a larger number of tracks have crossed the million selling mark over the last 3 years. But what's also been happening is that a broader range of labels are making hits with indie labels recently reaching 34.4% of sales. All such data points should be considered in understanding the relevance and changing dynamics of the long tail concept.
The possibility that the long tail is thinning is definitely worth investigating. Conditions change over time and theory adjusts to reality or else it just becomes opinion. There's also no reason to assume that a thickened long tail of production will be mirrored by a similar distribution of attention or one of sales. In fact, we may be seeing clear signs of a growing separation between such distributions.
The Long Tail Concept: Evolution and Related Ideas
There are other ideas developed at the time or since that we can think of as corollaries to the concept of the long tail.
As hits become scarcer, they will also become more valuable.
Look at the negotiating power big stars now have. Most don't really have the option to go indie or DIY given their lifestyles but, despite the limited nature of the competition, they seem more in control of their careers than ever.
The web has supported the emergence of a musical middle-class that can be thought of as a torso between the head of superstars and the long tail of proam creators.
It's a bit different from Mark Suster's discussion of the torso but I think that's an aspect of the metaphor well worth exploring at this point in time. Seth Godin discusses the torso as the "profitable, successful niche product."
The Phrase "The Long Tail" No Longer Fits The Discussion
Our discussions of the long tail have always really been about the whole thing, head, torso and tail. Even when Google CEO Eric Schmidt made his famous early remarks about the long tale in 2005, he wasn't just talking about the long tail. In fact, he said that they had been serving what sounds like a torso and that they needed to include the head and long tail:
"If you look at the advertiser, the market we're in, how do we do from the largest companies - Wal-Mart - in the world, all the way down to the smallest companies in the world, the single individual. We call this The Long Tail."
So we really need a better term for the discussion since discussions of the long tail concept are rarely about just that.
Many of the above points I'm making were touched upon at various points in Lefsetz's letter writing career. To some degree one could say Lefsetz's position has changed just as the data and objective conditions have changed but that he shifted from an overly enthusiastic embrace that assumed too much and now takes a stance of rejection.
But that take on Lefsetz is based on superficial evidence. And what would be the point of digging further? Lefsetz turns such material into inspiration for his writing and that's enough for most folks.
But what about the long tail?
The concept has been very productive and has given us an approach to discussing many things about the emerging digital world. It's not intended to explain everything but it's also not meant to be a concept set in stone. In fact, I would say that Anderson's book is now behind the times in its discusson of the long tail concept.
However, if you've read this far and haven't read "The Long Tail," I strongly encourage you to do so. It will be well worth the effort.
Hypebot Senior Contributor Clyde Smith (@fluxresearch/@crowdfundingm) also blogs at Flux Research and Crowdfunding For Musicians. To suggest topics for Hypebot, contact: clyde(at)fluxresearch(dot)com.