REVIEW: The Long Tail

REVIEW: The Long Tail

The article argues that consumers are often not mainstream and thus book
retailers, record companies and video stores must provide all content
available regardless of their popularity. This argument arises from the
observation that traditionally providing an article required enough local
demand to offset the costs of carrying it in store. However, with online
stores, a much larger set of articles can be sold for download or shipped
to users, with no need for in-store space. An incentive for providing such
"misses" is that their aggregate demand does in fact exceed that of "hits"
and can thus double the music, book and movie market - the Long Tail. The
problem addressed in the paper is rather of business and economic
implications than a systems one.

Evidence for the Long Tail comes from Amazon store creating a phenomenon
with the book Touching the Void years after its release and when it was
out of print. Additionally Netflix, an online DVD rental, has customers
which rent at a much frequent rate than regular video stores, and much of
the content rented is in fact the non-popular one. The key is to provide
both hits and misses as well as easy ways to discover new items so users
have a familiar staring point yet can easily discover unknown items of
interest. Failure to achieve this is illustrated with the case of MP3.com.

Another issue the author argues well is in the pricing of music, both hits
and misses. Online music is being overpriced by as much as 25% in oder to
safeguard the interests of packaged CDs. The overpricing is even alarming
when it comes to unpopular music, which can be sold for little as it
incurs no advertising costs and its production costs have been paid for or
written off. Yet, the author observes, the demand for music is highly
elastic as found in a study by Rhapsody, and a cut in price leads to a
much increased demand, leading in the end to higher revenues to the record
labels.

Although the paper identifies the success of this Long Tail approach from
Amazon as being achieved by linking products based on user purchases, it
fails to see that in doing so unpopular content will never be suggested to
users, even if it is in fact of good quality, thus a failure to dig deep
into the Long Tail.
Received on Mon Nov 28 2005 - 10:48:40 EST